With employers aggressively protecting customers and trade-secrets with non-compete agreements,  placement and human resource professionals will continue to encounter potential candidates/employees that have non-compete agreements and other restrictive covenants.   

Every employment interview should include exploration into these issues. 

Below are some suggested questions/considerations:

  • Has the candidate signed a non-compete, non-solicitation, or non-disclosure agreement?  If so, request a copy.
  • Does the scope of the non-compete conflict with the proposed employment? Is the candidate working in the same industry? Does the scope of the non-compete include the proposed geographic location?  What is the duration of the non-compete?
  • Is there a choice of law or venue provision in the non-compete?   The enforceability of a non-compete will vary from state to state.
  • Is the non-compete enforceable?  It may not be, but the best bet is to talk to a lawyer.  
  • Gather intelligence: has the former employer sued to enforce its non-compete previously? 
  • Is there any potential that the candidate could resolve the non-compete with a buy-out or some other agreement? 
  • Is litigation an acceptable risk for the new employer?
  • If there is a non-solicit, can the employee work within the parameters of the non-solicit?  Many times non-solicits are simply non-competes with a different name.  Some non-solicits only prevent the former employee from contacting former customers.  In that case, there is nothing that prevents the customer from contacting the employee. 
  • Remember, that any communications you have with a prospective employee might be subject to production in a lawsuit.  Be smart about email.

Going through the time and expense of hiring or placing someone to find out their ex-employer has filed a non-compete lawsuit would be devastating.  The questions above are a good starting point for screening, but a lawyer should always be consulted.