Figures. After only 5 months on the job, the company I work for has been sold as of this afternoon. Ex- employer is asking me to sign a termination agreement.

New employer wants me to sign a non-compete (among other things). I really don't want to, as it is too vague, WAY too broad reaching and there are no geographic limitations (world wide). I didn't sign one with the ex-employer since they didn't ask for one. New employer also has not extended any employment offer what so-ever. I was told the new owner is 'working on it'. Yeah, right. Kinda sounds like "...I'll only leave it in for a minute, baby..."

What would YOU do?

Ex-employer wants a termination agreement?? sorry, but what are they offering in exchange? Must be something, or they expect you to agree to be terminated? Does not make sense?

New "owner" of the company wants you to sign a non-compete? In exchange for what? They generally offer you something in exchange, so is it you will not be terminated but get to keep your job? For how long and etc, and how long do you have to agree to "non-compete"?

No one can make you sign away your ability to make a living, that will not hold up in court, but you may need a Lawyer to defend yourself. Can you afford that?

Have you seen a lawyer? Have one read the agreements for you. Probably cost a couple hundred. Might be the best money you ever spent. I have refused to sign non-compete agreements in the past, even with threats of termination. I "bought enough time" to find another job. Be careful what you sign.

How specific is your job function? Do you do computer support, or do you sell super specific medical widgets? It kinds of depends on what you do as to who they would call a competitor.

Are they asking you to sign a non compete, but not offering you employment? I'd hold of on signing anything until after you get an offer of employment.

One final thing, remember when you leave that you are under no obligation at all to tell them where you are going! No matter what company you are going to, just keep it quiet. Say that you are going to a small company they wouldn't know, or that you are taking time off for a while. That is the easiest way to avoid these situations at all.

Thanks for the reply. Employment attorney my wife had once said not to sign non-competes, no matter what.

All the online stuff points that way as well. Bitch is, I really like this job!!!

In my profession, Dentistry, a non-compete agreement must be minimally defined as to time, distance and activity. If any of these are defined in a manner as to make them "ridiculous", then it becomes unenforcable. We typically deal with distances of 1-10 miles, 1-2 years, sometimes 5 years, and defined as to dental specialty.

If they are asking you to sign a non-compete that is as for ranging as you say, then one might consider it a moot point, as a ridiculous document.

Have an attorney take a look, they need to understand the "usual and customary" for your situation. He will advise you specifically on your situation.

I was asked to sign one by a company I worked for a few years ago. The agent next to me was a lawyer (he made more $$ selling stuff than lawyering). He told me to sign it and not read it and hand it back in.

His advise afterwards was you were told to sign it or else your employment would be terminated (infered), so you signed it. You can not be forced to sign anything you don't understand or agree with and be held accountable for it.

I'm not sure of the laws in your state but you usually have the right to work and if your employer fires you (lets you go/lays off, ect) after making you sign such a document you can go out and get a job in the same line of work you were in before.

Usually these are handed out so you don't run off with their client list and start your own company supplying the same services for less.

Job function is very specific and quasi-upper management, Business Development Manager for intellegent vision equipment (License Plate readers and under vehicle inspection cameras primarily). My predecessors blew it for me as most of them went to direct competitors, most of them local!

To top it all off, I just brought in over $650,000 worth of new biz this month!

Tennessee law used to side with the employee in most cases. In the 80's , the laws were 'blue-lined' / modified. Now if it went to court, even if the agreement was deemed 'unreasonable' , the court would change the language to make it 'more reasonable'. In some cases they may still throw it out, but I'd rather not spend thousands of $$$ proving I'm 'right'.

That's the reason the old guy wants the termination agreement, so if you don't read the new guys paper and sign it they still have the short hairs. I would feel them out. See if they find value in your work. I highly dought I would sign anything like that. Any chance of scoring a position with a competitor? Sounds like you have some Skills!

Whether or not it's enforcable is pretty much moot. Deciding that in court will cost six figures, which is equal to how many months of salary with a new company? And with an agreement in place you won't be able to find a job with a competitor anyway, since you would be an uncertainty and liability to them if you're simultaneously fighting your previous employer in court. So accept that if you sign it you accept the agreement's terms. But don't give it away, that "what do I get for doing this" question is the key. Let them answer that and then decide accordingly. If the answer is "nothing" you know where you stand. If the answer is "you get to keep your job" then certainly they'll be willing to support that with a new contract.

I doubt they are dumb enough to do this but is there request for non compete contract ( in writting) if it is you have them by the balls . It,s to far reaching and you signed under threat of termantion. And can prove it! This is only good if you want to go to court ever. Start looking elseware. It appears they have very little regard for your contribution to the growth of the bussness. My 2 cents. Dave

Are you in a situation where you can walk away from this job? If you have family and are a sole provider, it may make up your mind for you.

I was presented with a "comittment letter" saying that if I received training, a security clearance or anything else, and left for any reason within 3 years, I would have to pay it back. I decided against signing it (to the astonishment of management) and since it was a sign it or you don't have a job situation, I begain to pack up my desk. They hastily backpedeled and decided that it wasn't necessary.

If a competitor has just purchased your company, that means that they paid money for your products and people (including you). They want to do the best they can to ensure that they didn't waste money. Their position is understandable, but they should have presented the noncompete as page 2 of your offer letter.

I'm in sales so I'm always asked to sign.

First procrastinate,,,,make them ask twice or more...

Second, wait to hear that you have a job first...wait for the offer..no reason to sign a thing without the job..

third,,,push comes to shove you have to make that decision..I usally end of signing but my company asked a year ago for me to re-sign...One e-mail and my follow up on such matters just sucks....!!! They are still waiting..

The business I used to be in, they put that paperwork in front of us to sign. I think I usually signed them "Jim Shorts".....no one ever noticed.

Thanks for all the replies! Teeners ROCK!!!!

I am prepared to walk. It'll smart for awhile, but I was self employed prior to this job and always have a lil' somethin' on the side (real estate, selling parts, cars, inventions, etc.)

Purchaser isn't a competitor, rather a buy-and-hold venture capitalist type. Ex-employer is a HUGE Govt. contractor that wouldn't give our division the time of day.

The other gripe I have is that they knew in Jan 06 that the company was up for sale. I probably wouldn't have taken the job had I knew in advance.

I just went through the same thing. I talked to a lawyer who handles these things and she told me not to stress about it. Most of the agreements are not even close to defendable. Like you have already pointed out, courts don't like vague wording.

I like that! See, you can use your sales skills for them or against them. Worst case, your out of a job. With the old guy wanting a termination agreement, your out anyway.

Best case the new guy realizes he's discarding assests of a new company, and backs off.

If you don't sign, you could always bail with your customer list. The old company can't touch you cause you didn't sign anything, and the new company can't touch you cause you didn't sign anything. I'm not a lawyer, but I stayed at a Holiday express once.

BTW: I worked for a couple of guys that did just that. They were the marketing guys for an independent adjusting company. They quit and opened up their own office and took 70% of the companies customers with them. It's an open market, there wasn't a dang thing they could do about.

I agree with virtually everything said above but one thing.

You are correct in noting that your particular state's laws are the key in in anticipating how a court might decide the enforceability of a non-compete covenant. Some states are more flexible than others, but the general rule is that the broader the terms, the less likely it becomes that it would be enforceable.

The one thing I disagree with that was said above is the cost of challenging the covenant in court if it became necessary. I have represented probably a dozen or so clients in challenging non-compete agreements, and I don't think it has cost any of them more than 10k. The evidence that can be offered in these types of cases is very limited, and is almost always decided through pleadings and depositions, as opposed to a trial.

Ultimately, my advice is always the same to clients: Don't enter into non-compete agreements unless you are getting something of real value to you in exchange. While most are unenforceable (I haven't lost one yet), you still need to look at it like any other contract. Do a cost/benefit analysis, and if the potential cost outweighs the potential benefit, don't do it.

Hey, was that an amulance that just went by??????

I have experienced this same scenerio a couple of times in the state of Kentucky. You pretty much sign it or most likely get canned.

One the second occasion, I consulted a lawyer. I actually traded my lawyer some 914 parts for his services. He was restoring a couple teeners and needed some parts. He basically said the agreement they wanted me to sign would be difficult to enforce in the state of Kentucky, given the wording and the fact that the geographic area of the no-compete was not well defined. It's a 50/50 shot that they would even try to enforce the no-compete if you left and went to a competitor.

Most people sign these without even thinking about it, but I sort of see it as, "Looks like the company will try to screw me in more ways than this if I sign".

Good Luck!

I signed one when I sold my cabinet shop back around 1990, but I was shortly hired back on as the sales/shop foreman. I quit a couple of years later when I caught the boss doing coke. He had put the whole thing up his nose less than a year later, so it didn't matter anymore.

also...
A friend had this happen when his company got bought out. He said sure for a 2 year contract or $150,000.

They fired him, so he went straight to the competition, took half of his clients with him and he got his contract.
He really screwed his old (but bought out) employer, cost them way more (maybe into the millions) then he was asking.

He's in the medical field....home care, lifts, supplies, etc.

Awsome!!

Everyone in this country who ever got SCREWED was so by signing something. Wanna get SCREWED?


I'd stay and do my thing and look for a job somewhere else and stick the paper up their butts fist handed when you leave. Your carrier is yours where ever you go and this will ensure you will only be allowed a window job at McDonalds!!

without reading all the posts - just wanted to with this one and give my same example - I hired on at my current job 6yrs ago and they required I sign a non-compete that was rather wordy and "all-encompassing". I had a law class at the time and asked the teacher (20yr lawyer still working - so not just "theory") and he said sign it. Too vague and, frankly, all a non-compete means is you can't really take any SPECIALIZED or proprietary stuff into your next job. Doesn't mean you can't use all of the skills you learned as that is frankly how you make a living. They don't hold up well.

I was concerned as one of the blurbs mentioned I can't design and sell automotive related items because the company was previously owned by GM. That is where I was baulking, but the lawyer said if I designed and patented aftermarket performance stuff on my own time with my own tools they wouldn't have a case at all. Use their tools (CAD at work for instance), they have right to it.

Non-competition seems really kinda specific, so vague language gets hammered by the courts AND THEY KNOW THIS TOO, so it is more or less a scare tactic to keep you from doing said things.

You have the added benefit of DURESS - sign or you don't have a job. NO CONTRACT IS LEGAL IF SIGNED UNDER DURESS and that would be VERY easy to show in your case and wouldn't cost hundreds of thousands of dollars. A lawyer could make a simple statement to the court and they may throw it out immediately anyway.

All that said, probably best to look for another job as you implied in your first couple of posts. If just sold to venture guys, that job is going to be shaky and up for resale before too long anyway and you have more BS to deal with.

Best of luck. Oh yeah, and don't sign anything unless they offer you a job and you want to take it. I wouldn't sign the termination agreement either without the new guys offering a job in writing. If there is a chance they could screw you, then screw them!

Don't sign unless it is part of your job offer, and only then if the conditions are acceptable realizing it will be very difficult to enforce at best.

This is probably a knee jerk reaction with too little thought. I would think about talking with others at your company, if alot of people think it is unacceptable as written then they might rewrite it. But most people are sheep and won't care.

If it is too broad you can mark it up to your liking, initialing & dating changes and sign. Probably not a good idea though because this shows you understand the document and that it was too broad.

if it is part of a job offer, then that is one thing. If they want to tack it on, then there are financial considerations (aka show me the money).
Chris

Have someone sign your signature close, but not exact . . .

Turn it in without anyone seeing you,
and don't quit and run to your competitor with the client list and prices.

I am under a no compete - The only examples I know of is when a competitor hires someone and if they are high profile enough, they pay them while they wait out the contract. . . Sweet.

Most of the time it isn't enforced here.

If you really like this job and your new ownership wants to retain you...carefully study the documents and revise them to your liking...in effect, you are turning the tables on them and defining your contract/agreement with them. If you are crafty enough, you may be able to engineer new terms that are actually better than the previous employment you had before. This is wishful thinking of course, but if you are a productive asset to this company...they may listen...and this may afford you the opportunity to define your compensation package to your liking. Too often, companies try to get something for nothing and intimidate their employees. If this is the case, maybe it's time to start searching. Good luck.

Typically companies provide some sort of monetary reward for signing non compete. My last employer gave me stock and a big separation package equal to about a years salary to get me to sign a non-compete agreement. It was also only 24 months long.

If they arent giving you anything why sign? I'd tell them to go pound sand.

Well, it finally happened. I told him to !!!!

At first I refused to sign the non-compete. This allowed me to drag it out a few weeks. I tried to negotiate the non-compete with the owner 2 times. The terms of the non-compete were outrageous,....like ANY activity at the job, no geographic boundry, no severance, etc. AND... he asked me to sign an employment agreement with absolutely no policies and procedures in place.

Problem with signing a non-compete in TN (even an unreasonable one) is that employers usually win. Best I could hope for is to get the terms changed so they are more reasonable after spending $$$$$ in court.

Next comes things like changing my job title. Basicly a demotion, likely with a corresponding drop in pay.

Soooo... he's convinced I'm going to cave and sign, like all the other sheep in the office did. I tell him I'm resigning! I was their entire sales staff / only salesman. No biggie, as I'm not so sure the company will survive anyway, especially with the new owner at the wheel.

Thanks to all for the advice!

One thing to remember, if you sign a non-compete the employer has already won. They usually have waaaaaaay more money for litigation than you do. It also makes it harder to get hired at a new job with a non-compete hanging over your head.

A guy I recently bought a car from told me that his ex-employer (a major telcom) sued him for non-compete after leaving his job as a 'pre-emptive' measure. HE HAD DONE ABSOLUTELY NOTHING to violate the non-compete, they simply did it "because they could"!!!!!! Even though he did nothing wrong, he lost (in Federal court, because they heavily favor employers), and it cost him about $30k to defend himself.

Way to stick to your guns! I'm sure you'll find something else pretty quick.

Iyeee!!!

I just started at a new company. Their non-compete agreement is really aggressive. It states that I cannot work for any company in competition with them and then lists in parenthesis named examples. What should I do? I'm only 20 and I'm sorta small fish. But I'm a trained machinist. This is a prototyping shop and I'm afraid that signing an agreement will stop me from working at any other prototyping shop. The easiest way to make more money in this field is to change companies. And getting into these high-end prototype shops is the next step to getting a much higher pay range.

Sign it "Elvis Presley" ?

I sign my C in "Chris Logan" Like an E.

How long does it stay in effect?

Saying you can leave for a direct competitor doesn't sound too crazy to me.

I agree with most of what is stated above.

But legal defence is expensive and I would rather put $10K somewhere else.
(my teener wants a bigger six)
{edit} So get legal advise before signing.

My attorney told me to delay as long as possible, but if you are forced to sign
write in big block letters "SIGNED UNDER DURESS" by your sig.

Really watch for the INTELLECTUAL PROPERTY AGREEMENT. I have been asked
to sign docs saying that anything I have thought of or built at the time of my
employment is property of the company and further, anything that I come
up with any time in the future is theirs if it relates to that business.

That would mean my 914 could be thiers as I worked on it nights and weekends
while employed by the company. Gush even that new 914-6 muffler bearing
that I was going to sell on EBay is theirs !!!

bob (darn, I was hoping to become the muffler bearing baron)

Legal advice is worth what you pay for it... Do yourself a favor and hire an atty who specializes in employment law. Prob cost you about $500, which should be tax deductable...

-pt