Is Your New Hire Subject to a Non-Compete Agreement?

Your company searched near and far and finally found the perfect job candidate for a key position. The employee immediately jumped in and seems to be a high performer. All is going well . . . until your company is hit by a lawsuit accusing it of unlawful competition and trade secret theft. So, what happened? Your company hired an employee who was subject to a non-compete agreement with a former employer.

How can an employer protect itself against this situation? The easiest way, of course, is to fully vet a job candidate during the interview process. Ask if the employee has a non-compete, nonsolicitation, nondisclosure, or confidentiality agreement with a previous employer. Ask if the employee has an employment agreement or a separation agreement that contains restrictive covenants. The existence of an agreement doesn’t mean your company can’t or shouldn’t hire the candidate. But, it does mean your company needs to explore the agreement’s boundaries, perform a risk assessment, and figure out if the candidate can work for the company without violating the agreement’s terms. Because, even though the employee is the party who signed the agreement, your company will likely be roped into any litigation. Taking these steps could save your company untold costs.

To learn more about non-compete agreements, contact an employment lawyer in your area. This article is presented by the employment law attorneys at Clouse Dunn LLP. For inquiries, send an email to debra@clousedunn.com or call (214) 239-2705.