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Many employers who recently faced unexpected job transitions during the pandemic’s economic nose dive can relate to the sense of uncertainty that often arises when a departing worker blows the dust off an old non-compete agreement and starts to consider its requirements.
Depending upon the agreement’s language, the restrictions in a non-compete frequently will apply even though the employee may have been laid off due to business necessity rather than performance issues.
Why? Many higher-level employees still pose serious threats to a former employer because of their previous access to confidential information and close customer relationships.
If you are a departing employee worried about the consequences of a non-compete agreement, here are several ways to mitigate your risk:
Don’t take documents
Retaining documents or data is a common impulse for departing employees — especially for those who are separated without fault and feel that holding onto templates or samples of their own work product will help them land on two feet.
Former Google engineer Anthony Levandowski learned the perils of this practice. Levandowski pleaded guilty to taking Google’s secret technology related to self-driving cars before becoming the head of Uber’s competing operation.
In August 2020, a judge in San Francisco sentenced Levandowski to 18 months in prison and a $1 million fine. In a parallel case, a court found that Levanowski poached former Google engineers and ordered him to pay his former employer nearly $179 million in damages.
Criminal and civil penalties as high as Levandowski’s are rare, but his case illustrates an important lesson in employment law — the work your employer pays you to complete rarely ever belongs to you when your employment terminates.
Do not take any documents, secret or otherwise. You likely will get caught and may get sued.
Don’t solicit customers and co-workers before you leave
Customers and clients have the right to do business with whoever they want.
While you obviously hope your clients and customers are prepared to follow you to your new job, soliciting them to come with you before you depart will anger your current employer and likely breach your duty of loyalty.
Persuading co-workers to leave with you also may get you sued.
Consult your non-compete agreement with regard to when and whom you can contact. It likely contains non-solicitation provisions that govern your conduct toward other clients and customers.
Don’t burn bridges or create more drama
A respectful resignation and departure likely will reduce the risk of a lawsuit against you.
On the other hand, a resignation accompanied by slammed doors, curse words, and similar inappropriate drama and conduct will get you sued.
The reason is simple. People are quicker to sue those they do not like.
It doesn’t hurt to shake a hand or two and say your goodbyes on the way out of the office.
It may just lower your chance of getting sued in the event you do find yourself on the wrong side a non-compete dispute.
Wilford H. stone is a lawyer with Lynch Dallas in Cedar Rapids.