Non Compete Clause for Employees

[chris kennedy]

I'd call that stealing if they are on the clock.

I would venture a guess that my employer would say "I have 20 employees and 21 of them are stealing.":grin:

 

[iwire]

I'd call that stealing if they are on the clock. If an employee is soliciting an employers customers after hours I'd guess that is legal.

Well they cannot be stealing the customer as you do not own the customer.

I guess you could call it stealing for wasting your time but then you better call it stealing when employees stop for a smoke or to talk to each other.

 

[mkgrady]

Well they cannot be stealing the customer as you do not own the customer.

I guess you could call it stealing for wasting your time but then you better call it stealing when employees stop for a smoke or to talk to each other.

That's what I meant. Using time that is paid for by the employer to solicit business is stealing. I think the talking and stopping for a smoke is not stealing because it is generally accepted by employers.

 

[wireguy8169]

A company I worked for use to give us a commission if we got more work on a job or brought customers in. So, if your worried about guys doing work for cash I would suggest compensating them for upselling work doesnt have to be much most people just appreciate being appreciated.

 

[hurk27]

All you want to know is found HERE

A few states will not even recognize them such as California.

 

[dbuckley]

My wife did consulting and a non compete clause was usuallly in the contract it also delt more with intelectual property.I don't mind an employee going in to business I just don't want them using my proprietary information to do so.

Beaten to it, but... This is common in some parts of the IT industry, in that the propriety information an employee acquires (or develops) as part of their job has value in its own right, which the employer has paid for, and you don't want that information walking out the door and competing with you head on.

I cant see you would ever get it to fly with "interchangeable" job functions, particularly one as prescriptive of an NEC-bound electrician.

Even in jurisdictions that acknowledge these non-compete clauses, the terms have to be fair and reasonable, or if push comes to shove a judge will chuck the case straight out the door. So for example, for duration of non-competition, six months would be reasonable, five years not reasonable. One year, well maybe, maybe not, depending on the judge...

Edited to add: I've been "used" as a sub contractor through an agency to a client many times, and the contract I sign with the agent always prevents me from working directly for the agent's client for some period of time. It varies by agent how long the period is, and the contract the agent has with the client has the penalties for them breaking it, usually something like the agent gets 100% of the contractors rate for a year.

 

[flatlander]

what would you call it or say if:
Your current foreman while employed full time by you. Solicits other EC to help them outbid the projects your current boss is actively seeking. Then expecting to moonlight for the second boss or just get a fee. Basically using the bid information his boss used. By the way this happend to a competitor and no involvement with me.

 

[hurk27]

what would you call it or say if:
Your current foreman while employed full time by you. Solicits other EC to help them outbid the projects your current boss is actively seeking. Then expecting to moonlight for the second boss or just get a fee. Basically using the bid information his boss used. By the way this happend to a competitor and no involvement with me.

Bid fixing, and against the law in most states if not Federal law, but very hard to prove unless there is a paper trail.

 

[dbuckley]

what would you call it or say if:
Your current foreman while employed full time by you. Solicits other EC to help them outbid the projects your current boss is actively seeking. Then expecting to moonlight for the second boss or just get a fee. Basically using the bid information his boss used. By the way this happend to a competitor and no involvement with me.

There's some serious dishonesty there, but that isn't the sort of thing that a non-competition clause would capture.

We're the employer find out, then I would expect the employee to be terminated very quickly, that would be serious professional misconduct in employment terms.

If there's proof, I'd be looking for a lawyer to help sue the other contractor out of business, for the business you lost.

 

[gadfly56]

Bid fixing, and against the law in most states if not Federal law, but very hard to prove unless there is a paper trail.

This is not bid fixing or "rigging". In a case of bid rigging, two or more conspiritors decide who wins a bid ahead of time. In this case, the employee is stealing confidential information and selling it to a competitor. This is simple corporate espionage.

 

[stevenje]

I am trying to find a suitable non compete clause (NCC) for my employee to sign.

Why bother. If you are worried that an ex employee is going to take work away from you in the future, out bid him when that time comes around. Treat him just like you would with any of your other competing EC's. If you believe in your business management and your bidding process you have nothing to fear.

 

[satcom]

It appears many of the replies, don't see the real issues, when someone operates an electrical business, it takes years to build a customer base, and this base does not just pop up, it takes a good amount of time and money to build a customer list, so when an employee decides to leave and strike out on his own, with your customer base, he is stealing you biggest investment, it is theft plane and simple, and having a non compete contract, in place, is the best way to protect your business from such a loss, this type of theft can also put all your other employees at risk of losing their employment.

The employee is not taking work away from you he is steeling a company investment.

 

[Rewire]

It appears many of the replies, don't see the real issues, when someone operates an electrical business, it takes years to build a customer base, and this base does not just pop up, it takes a good amount of time and money to build a customer list, so when an employee decides to leave and strike out on his own, with your customer base, he is stealing you biggest investment, it is theft plane and simple, and having a non compete contract, in place, is the best way to protect your business from such a loss, this type of theft can also put all your other employees at risk of losing their employment.

The employee is not taking work away from you he is steeling a company investment.

Our customer list is more than just names we have e-mail address,cell#,managers names , birthdays ,anaversary,etc.

 

[K8MHZ]

It appears many of the replies, don't see the real issues, when someone operates an electrical business, it takes years to build a customer base, and this base does not just pop up, it takes a good amount of time and money to build a customer list, so when an employee decides to leave and strike out on his own, with your customer base, he is stealing you biggest investment, it is theft plane and simple, and having a non compete contract, in place, is the best way to protect your business from such a loss, this type of theft can also put all your other employees at risk of losing their employment.

The employee is not taking work away from you he is steeling a company investment.

This is just a part of the free enterprise system.

Do you think customers should also sign such an agreement? Remember, there are two parties to consider, the ex-employee and the customer. What if the customer wants the ex-employee and no one else to do a particular job for them? Do they not have the right to choose who does their work?

Competition is the basis of the American free enterprise system, whether we like it or not. As this thread illustrates, it isn't always a bed of roses. Free enterprise also brought us the fine goods from China we all now enjoy at the expense of millions of jobs. The worship of the almighty buck and the downplay of the importance of the individual worker is great for a good bottom line, temporarily. Historically the practice has had disastrous consequences in the long run.

My take is that if you want to keep your customers you should provide them with a valuable service that is easily worth what you are charging them.

 

[Rewire]

This is just a part of the free enterprise system.

Do you think customers should also sign such an agreement? Remember, there are two parties to consider, the ex-employee and the customer. What if the customer wants the ex-employee and no one else to do a particular job for them? Do they not have the right to choose who does their work?

Competition is the basis of the American free enterprise system, whether we like it or not. As this thread illustrates, it isn't always a bed of roses. Free enterprise also brought us the fine goods from China we all now enjoy at the expense of millions of jobs. The worship of the almighty buck and the downplay of the importance of the individual worker is great for a good bottom line, temporarily. Historically the practice has had disastrous consequences in the long run.

My take is that if you want to keep your customers you should provide them with a valuable service that is easily worth what you are charging them.

Its nit about customers it is about information that has been aquired over time.It also extends to protocals that are a part of the daily operation of the business.

 

[electricguy]

I guess my concern is an employee using company materials, padding hours , by doing extras for the customer and pockeing the cash which as his rate is cheaper than mine. BTW this is for satellite installs. all the overhead to process these installs has been paid by me. I have the contract to do the installs they pay very little so any extras are needed.

 

[satcom]

Its nit about customers it is about information that has been aquired over time.It also extends to protocals that are a part of the daily operation of the business.

It has nothing to do with free enterprise or competing with business, when you seek out your ex employees customers, you are not competing, you are simply stealing, and in many cases customers do sign a non compete employee clause, when they sign many of the service invoices and contracts, in most cases a non compete contract, will have well defined conditions, the purpose of the contract is not to prevent an ex employee from seeking other work, or even operating his own business, it's main purpose is to have some protection, if he walks away with the company customer base, which is private property, he will have to open his business the old fashion way, work for his own customers, not steal them from, a previous employer.

 

[rodneee]

It has nothing to do with free enterprise or competing with business, when you seek out your ex employees customers, you are not competing, you are simply stealing, and in many cases customers do sign a non compete employee clause, when they sign many of the service invoices and contracts, in most cases a non compete contract, will have well defined conditions, the purpose of the contract is not to prevent an ex employee from seeking other work, or even operating his own business, it's main purpose is to have some protection, if he walks away with the company customer base, which is private property, he will have to open his business the old fashion way, work for his own customers, not steal them from, a previous employer.

your post is well written and i see the logic...however your theory holds true only if you make one large assumption, that being that a court of law would see a customer list as intellectual property...

 

[zog]

your post is well written and i see the logic...however your theory holds true only if you make one large assumption, that being that a court of law would see a customer list as intellectual property...

Oh they will, seen it. But a "Non-compete" clause would not protect against this, that would be a "network confidentility agreement", which basically says that employee is not allowed to copy your customer list, or anything else that is company property, from his or her computer or files.

NC's are hard to enforcce against a person, but they can hold up if they are valid. If you as the employer pay for training for a special skill set, then your NC should hold up if the employee leaves your company and uses those skills to the same customer base. But non NC will stop an electrcian from doing normal electrical work, they have a right to earn a living.

 

[satcom]

Oh they will, seen it. But a "Non-compete" clause would not protect against this, that would be a "network confidentility agreement", which basically says that employee is not allowed to copy your customer list, or anything else that is company property, from his or her computer or files.

NC's are hard to enforcce against a person, but they can hold up if they are valid. If you as the employer pay for training for a special skill set, then your NC should hold up if the employee leaves your company and uses those skills to the same customer base. But non NC will stop an electrcian from doing normal electrical work, they have a right to earn a living.

I think some, are taking a narrow view of what a non compete agreement is
http://findarticles.com/p/articles/mi_qa5292/is_200710/ai_n21269623/ This is for New Jersey, every state has different laws that apply.