In the June 21, 2016 Ask The Headhunter Newsletter, a reader doesn’t like giving up future opportunities by signing restrictive agreements.
First of all, thanks for writing your columns and educating us folks out here. If we ever form a union, you’ll get my vote for union leader! Anyway, I was wondering about non-competes and NDAs. I know you’re not a lawyer, but I’d like to hear your thoughts on the subject.
I can understand why companies want and need non-competes and NDAs, but I feel signing such contracts limits my future job opportunities; at least the ones that would pay me the most. So, I could refuse to sign, and they can refuse to hire me. If I want the job, it seems I’ve gotta bite the bullet. Perhaps I could sign the contract as “Darth Vader” and they won’t notice.
Is there a fair, balanced deal that I could make here? Thanks for your thoughts.
Ouch, you’re hitting a nerve. Non-compete and non-disclosure agreements (NCAs and NDAs) are a sore spot with me because I believe they’re over-used, misused and too often signed. Nonetheless, both documents are becoming more common. Heck, they’re such boilerplate that you might be right — you could sign as Darth Vader and they might never notice! Some companies might just file the darned thing without looking at it any more carefully than they expect you to. But, don’t bet your future on that.
What’s an NDA or NCA?
For those who don’t know what we’re talking about, an NDA is an agreement you sign as an employee prohibiting you from divulging sensitive company information while you work at the company and often after you leave. When you sign an NCA you agree not to compete with your employer (now and when you leave) by soliciting its customers, going to work for a competitor, or through other actions. Sometimes, an NCA and an NDA are rolled into one document.
I think companies often use NCAs and NDAs for no other reason than because “everyone else does it.” The fact is, these agreements are very controversial. In some states NCAs are illegal because they restrict a person’s right to earn a living. Nevertheless, when you take a job, it’s up to you to protect your rights.
There are some legitimate reasons for a company to ask you to sign such agreements; for example, when you’ve worked on a sensitive trade secret that, if leaked, could cost the company a lot of money. It’s up to you to decide what’s reasonable, or to discuss it with an attorney who represents you, not the company.
Negotiate the terms
There’s no reason to get into an argument with a prospective employer about an NCA or NDA. The best thing to do is negotiate it. Because these agreements are often legal boilerplate, a company that really wants to hire you may be willing to negotiate specific terms that you object to. You may be able to get both the compensation deal you want and a comfortable agreement.
Your goal with an NCA or NDA is to limit the constraints. Here are some terms to negotiate:
- Geography: A 100-mile radius of non-competition may be reasonable, but a blanket “all of the U.S.” or “all the world” is just nuts.
- Term: One year may be acceptable, but a five-year restriction is not.
- Competitors: Prohibiting you from working for any company in an entire industry is extreme. Try to get them to list specific companies by name. Make sure the list is short and realistic.
In light of the limit that an NCA or NDA might place on your future job opportunities, I recommend getting quid pro quo. That is, get fair value for anything you relinquish — and work this out before you accept a job, not after you’re on board. An employer has no incentive to re-negotiate an overly restrictive NCA or NDA after you’ve already joined up.
Trade fair value
When a company wants an NDA or NCA to protect its interests, then you should get something to protect yours. Always trade fair value. If a company is going to restrict your ability to earn a living, it should compensate you reasonably.
Get a contract.
If you agree not to go work for a competitor for a year (by signing an NCA), then don’t agree to work “at will,” whereby the company can let you go any time it wants. In exchange for signing an NCA, request an iron-clad employment contract. That way, if the company terminates you, it agrees to keep paying you through the end of your contract. The NCA gives the company protection (perhaps for a year), and the employment contract protects you (for a year also). By asking for a year, you might be able to get six months’ pay, if you consider that sufficient.
Get a severance deal.
Another quid pro quo for an NCA or NDA is a significant guaranteed severance deal. Ask for it, since your choice of next employers will be limited. Negotiate a severance package as a form of compensation for relinquishing your right to compete or to “talk about your work.” (Be careful: A blanket NDA can actually restrict you from talking about work you’ve done that is not even proprietary to the company!)
What might be in a severance package varies. Usually, severance is one week’s pay for each year you worked at a company. But in this case, we’re not talking just about severance; we’re talking about a special deal that compensates you for relinquishing some of your freedom. In my opinion, if you sign a one-year NCA, the company ought to cover you for at least a year after you leave, or until you land a new job that does not violate the agreement. (If that sounds extreme, so is an NCA!)
If the company’s not willing to compensate for protection, then it should not require an NCA or NDA. It should instead keep better control over its proprietary information and avoid divulging to you anything during your employment that might compromise the company when you leave. It’s up to the company to manage its assets — not you.
If any of this perplexes you, it’s smart to consult an attorney. It will cost far more to defend yourself later than it will to protect yourself now. (For some valuable insights from my favorite attorney, Bernie Dietz, see Employment Contracts: Everyone needs promise protection.)
Thanks for your kind words about Ask The Headhunter. But, no thanks — don’t elect me as your union leader!
Have you ever signed an NCA or NDA? Did it come back to bite you? Or, did you negotiate compensation for a fair restriction? How would you advise this reader?
Having experienced several incidences of employee greed over the years, I understand the reason for the legal side of why employers require an agreement.
I’ve always signed and upheld the NDA or similar contract because my employer is paying me to perform and by obligation, I honor the pay for performance on their terms.
Having said that, previous employers have used the contract as ransom for future earnings. My experience is that doesn’t work. If you provide a quality and unique service, nothing can duplicate that over time. Yes you may be inconvenienced for a short period while your contract terms expire but in the end your unique value will prevail.
Nick is 100 percent right, but….In negotiating an unreasonable NDA (not all are for proprietary information, keep that in mind), and avoiding a NCA unless there’s that quid pro quo payout, be prepared to WALK AWAY. Employers increasingly don’t negotiate and will simply withdraw offers. It’s part of the current environment. And it has happened to me. That also tells you a great deal about the company…dodged a bullet there.
What do you do if you are already working for a company and they ask you to sign an NDA/NCA? I have worked for companies where, after you have been employed, they require you to sign these and make it clear employees who don’t will be terminated.
Also, I was recently asked to sign an agreement that included the following provisions. I did not sign it. Even if the provisions are not reasonable or enforceable, it would be an expensive proposition to litigate.
For a period of five (5) years from the effective date, all Confidential Information shall be maintained in confidence by Contractor, shall not be disclosed to any third party, and shall be protected with the same degree of care as Contractor normally uses in the protection of its own confidential and proprietary information but in no case with any less degree than reasonable care. Contractor further agrees not to use any Confidential Information received from *** except for the purposes set forth above.
During the term of this Agreement and for a period of two years following any termination, the Contractor shall not, directly or indirectly hire, solicit, or encourage to leave ***’s employment, any employee, agent or contractor of *** or hire any such employee, agent, or contractor who has left ***’s employment or contractual engagement.
Another 2-Year Provision
During the term of this Agreement and for a period of two years following any termination, Contractor will not directly, or indirectly, solicit any business performed for any clients of ***. In particular, without limiting the generality of the foregoing, in connection with the discussions and negotiations among the parties the existence of certain proprietary ventures, business relationships, contacts and other relationships of *** (Relationships) may be disclosed. To the extent that these Relationships are confidential to *** then Contractor shall not interfere in any way with the Relationships, nor shall Contractor approach any of the those Relationships for the purpose or with the effect of circumventing ***.
I believe a lot of the uproar over these contracts is a tempest in a teapot. Yes, if you are in the top research position, working on the next world’s greatest (drug, app, tech, fill-in-the-blank) and you get a double-your-salary-offer to go work for the #2 company, #1 may have issues and get lawyers involved that will bankrupt you if you fight.
But in general, it is extremely difficult to litigate that YOU provided proprietary information to a competing company that is not available elsewhere, and it is VERY unlikely unless you have industry recognition on a level with Steve Jobs that anyone will care that much to go after you.
In a customer/service based industry, where clients are involved, that is a different story. NCA’s have been commonplace in Legal, Medical and Accounting firms for decades, as it is only fair that after you have trained an associate for years, introduced them to your clients and contacts, and then they quit and want to open an office across the street, that an NCA is not only legal but enforceable.
@SF – the last 2 clauses directly pertain to this, and only prevent you from SOLICITING or ENTICING clients and employees to follow you. What they do of their own free will is their business and not subject to an NCA.
Just remember in this day and age that the internet remembers all – no texts, no emails, no Facebook posts, ever.
This relates to SF’s comment. I was in a similar situation. I was working as a NASA contractor and the contract was won by a new company. So we all moved to the new company (that’s just the way things work there). Same job, new employer.
Then the company I worked for merged with another and they wanted us to sign a combined NDA/NCA. I had my reservations about it for reasons mentioned in the article and it turned out that I wasn’t the only one, including my direct line manager. I was getting ready to talk to him about it but he approached me first wondering if I had any reservations or issues and sharing the ones he had.
So a group of us pushed back asking for changes and clarifications. In the end they dropped the requirement to sign the document. I ended up working there for another five years before taking a faculty position at a university.
My last positions have been with small businesses or start-ups where it is absolutely essential to protect our intellectual property before it becomes a product. I have had employees object to certain clauses or sentences, and it’s been easy to modify them to everyone’s satisfaction.
If everyone keeps in mind the intent and purpose of an NDA, i.e., to protect a company’s proprietary information from being prematurely revealed to competitors, there shouldn’t be many problems.
Conversely, large, well-established corporations shouldn’t require a NDA because you hired on to modify their website or compile their payroll. In the case of a large corporation, I would modify the most egregious passages. As Hank pointed out, the number of people who could actually harm the company are a small subset of the entire workforce.
Twice, I’ve been employed first, then asked to sign an NDA/NCA later on, with the hard-line threat of being terminated immediately if I refused. Each time, I talked to a friendly lawyer who specialized in employment law in my state, and she believed neither agreement would be upheld if it went to court. Because I wasn’t prepared to job hunt either time, I unhappily signed. Fortunately, nothing ever came from them.
In one case, the NCA was also accompanied by an Patents/IP/Copyrights agreement that declared company ownership of all my work products. That’s fine, but it also required me to submit to their lawyers for review *ANYTHING ELSE* I invented/wrote/created during my employment, even if done using no company resources or time, and even if it was a new cat toy, a fantasy romance novel, or a painting donated to the library. If I didn’t sign the non-negotiable agreement, I’d be terminated. My only protection was that I got to submit a list of “prior art exclusions.” I made up a three-page, two-column list of every idea I’d ever had, with vague word-salad titles that could plausibly cover my assets. Someday, I’ll include the company in a book as a group of grasping, bullying jerks who get their comeuppance in a particularly gruesome way.
@SF: You really must balance the value of the work/contract you want against the risk of the employer strictly enforcing the terms you agreed to. As I read the examples you provide, I once again see the problem. This isn’t a reasonable, prudent agreement in simple English – it’s legalese designed to intimidate. Some sections you have to read multiple times, just so you don’t lose the structure of the sentence in your mind!
@Hank: If these agreements are “a tempest in a teapot” because many of them will never be enforced, why don’t employers just omit them? This is where the strong arm of the law is brought to bear unreasonably. Who’d want to work for a company that subjects them to the possibility of litigation – when there’s little ground for justifying it?
(Mind you, I acknowledge that some NCAs and NDAs are prudent and necessary. But I still think any terms concocted by lawyers can and should always be negotiated down to only terms that really matter. Most of them don’t matter to the employer, but create unnecessary risk for the employee.)
RE: how you interpret part of SF’s agreement: “the last 2 clauses directly pertain to this, and only prevent you from SOLICITING or ENTICING clients and employees to follow you. What they do of their own free will is their business and not subject to an NCA.”
Good luck proving in court that those “clients and employees” followed you of their own free will, while your old employer pounds you with paper and legal briefs. In this day and age, employers reveal themselves to be less concerned with a good working relationship with employees, and more concerned about recovering loses incurred through a company’s own poor management and stupidity relating to proprietary information.
Then there’s the problem of employers “investing” in employees: “NCA’s have been commonplace in Legal, Medical and Accounting firms for decades, as it is only fair that after you have trained an associate for years, introduced them to your clients and contacts, and then they quit and want to open an office across the street, that an NCA is not only legal but enforceable.”
I think that’s bunk. The person who comes to work for such a firm takes a risk, because they might fare better elsewhere. The employer also takes a risk that the worker might leave. That’s the balance, and big boys and girls focus on promoting a good working relationship so that everyone will want to keep working together. The notion that an employer has a right to recover their training investment in a worker who leaves is preposterous. Should that worker have the right to recover lost income from that same employer, if it turns out the worker would have gotten paid more elsewhere during that time?
So much of this is about companies trying to recover losses resulting from poor management and business practices from anyone they can. The new employee becomes the prime sucker. If the employer treats its employees and customers well, a departing employee will not be able to poach them easily.
I grant that there are cases where proprietary information and trade secrets need to be protected after an employee departs. But those cases are rare in my experience. If we tally up all the NDAs and NCAs that have never been enforced, what we really see is needless psychological bludgeoning of employees intended to keep them in line. I’ve known many people who were afraid to leave their jobs because of NDAs and NCAs. And I think that’s exactly what employers intend.
@Tom, SF: I worked for a company many years ago that was acquired. The new owners promptly sent NCA agreements to all managers and demanded that we sign them. Every manager signed, afraid of being fired. I simply ignored the agreement. HR kept calling to ask me to sign it. I never argued, never explained – and I never signed. It was simple to me: My new employer had no leverage. All it could do was fire me and watch the department I ran crumble on my departure. When the company began to fail, some of the other managers were not able to find new jobs due to the geographic restrictions in their NCAs. Sometimes the best action is to ignore a demand and wait for the other party to calculate the risk it takes if it presses the matter. I’d never sign an NCA or NDA presented to me while I was an employee — unless I received fair value back.
From a tactical standpoint, a horrendous world-wide, 10 year non-compete is better than a reasonable 6 month, 50 mile non-compete.
The former is unenforceable.
You probably don’t want to work though for a company that is either ignorant enough to write that in or unethical to ask for it.
Great column. I’ll feel much more prepared if I encounter this in my job hunt.
@Larry B: My compliments for how you handle these agreements. I agree that “the number of people who could actually harm the company are a small subset of the entire workforce.” And that’s why the terms of NDAs/NCAs that really matter are a small subset of what’s usually presented to the employee.
@Caro: I love your “prior art exclusions.” Nice job! But this just makes my point: Employers go way overboard, and for what??
@Al: I get your point about onerous NCAs being unenforceable. But once you sign that baby, you may have to put it through law school. :-(
I did contract work (through an agency) for a firm for six months. They built gas turbine test systems. On the final day of the contract, they offered me a six month contract renewal, taking me on directly without the agency being involved.
The HR person called me in to their office and asked me to sign the contract right there and as I read through it, they got huffier and huffier. I guess no one had ever wanted to read the contract before. As I read the contract, my experienced eye told me that a business lawyer had written the contract and not a labour lawyer. There were a number of questionable clauses, Employees duty to mitigate any and all damages upon termination of employment, fiduciary obligation to the employer, a 12 month restriction on being a Technical Writer with 80km of the employer location, not being an executive officer with any other aerospace firm within 50 miles for 12 months and all kinds of other diddily nonsense that are not normal for a technical writer.
I told the nice lady (???) I would have to ask my lawyer to review the document before signing. I went home, found a labour lawyer who could see me on short notice and we sat down and went through the 11 page contract. By the time he was finished there was a large amount of notes in the margin. He said to go back with the contract and tell them that it was a good starting point to work from. I asked him of his honest opinion, after all the clock was running and the bill was now at $400.00. His response was how desperate was I to work for them under contract with reduced pay and a second 6 month probationary period that penalized me and not them and the heavy legal restrictions on my livelihood in a city with very few high tech industries remaining.
His words were, “Don’t tell them it’s a piece of shit, tell them your lawyer says it’s a piece of shit.” And with that I returned on the Monday and met the HR lady and said that my lawyer said that the contract was a great starting point. I worked for the rest of the day and after arriving at home, an hour later, a courier arrived with the contents of my personal effects from my office space.
As a result of not signing their stupid contract, I take great pleasure in denigrating their behaviour and stupid contract when the opportunity to do so presents itself. If pressed to back up my claims, I photographed all 11 pages for future reference.
My advice to everyone and it’s free, “Do not sign anything until your lawyer has declared the contract to be in your favour or mutually beneficial to both parties, employee and employer.”
The contract you are being asked to sign may have been prepared by a business or real estate lawyer. These lawyers have no experience with federal, provincial and state labour codes that change often. The contract could well be the same contract given to the employee 5 years before you and just the names were changed and the result is a document that is woefully out of date.
In my case the contract was out of date on the labour code by 5 years and signing it would have placed me at a serious financial disadvantage without any legal recourse after the fact. They had a clause that I could be terminated and not receive compensation, including wages owing.
The thing on inventions, whew, 24/7/365 my time, their time, my resources, their resources, didn’t matter, it all belonged to them, no matter what industry or technology it was.
Hire a labour lawyer and ask them to split the fee with you.
@Richard T. “Do not sign anything until your lawyer has declared the contract to be in your favour or mutually beneficial to both parties, employee and employer.”
Bravo! That is the right answer. Spending a few hundred dollars on an attorney to go over an NCA/NDA is relatively cheap insurance against a bad decision that may end up costing you tens of thousands of dollars.
I’ve gone through the same process. Fortunately, the folks I consulted for were reasonable. Once the contractual concerns were brought to the attention of the owner, he was more than happy to modify the agreement so it would be acceptable to everyone.
Very good topic. I was once laid off (along with 100+ others due to mismanagement) and asked to sign an NCA for a decent sum of money. I booked an appointment with a labor lawyer. She said she would NEVER sign it. Among many things, it specifically stated that I could not have any contact with any person or company that I knew because of my employment with the company that laid me off. At the time I was selling bottled water to the DOD, this contract would prevent me from taking a job with Caterpiller to sell heavy equipment to anyone at the DOD! For real! I was doubtful how enforceable this was and the lawyer said she had seen companies win this kind of case. Even if I did win, she asked, “do you know how much it would cost you to litigate it?” Also not recoverable. Might I add the company I worked for had a history of protracted legal fights that I thought were a bit ridiculous. Needless to say, I did NOT take the cash and I did not sign. There were about a dozen of these kinds of concerns in the NCA. Best $400 I ever spent on legal advice.
Another problem out there is risk-adverse companies allowing unconscionable NCAs to be effectively enforced.
A friend who was a low-level contract medical writer signed a NCA that would not have been enforceable anywhere (10 years, prohibited any employment in the medical field worldwide). He quit and went to another company doing similar work. The first company found out where, and served the new company with a cease and desist order based on the NCA. The new company just fired him because they didn’t want to deal with it. Without the resources to litigate he didn’t really have any options.
His remedy was to go dark on social networks so that the old company would have a hard time stalking him at a new place.
Best advice is the advice above that says, anything you sign have reviewed by a employment lawyer beforehand.
Now for some personal experience.
I have worked many years for consulting firms doing software development for their clients which were mostly the big name telephone companies. The consulting firm would often have a document that said that for some time period (usually 6 months to 2 years) I could not work for or take consulting work for any of their clients. The client was AT&T and their other clients covered the rest of the industry.
My response was, “I understand that you don’t want to place me somewhere and then have me get hired as an employee without compensation, but if I sign this I will be shut out of any other position when the contract ends.”
I said that I could agree, to not take employment or a different consulting position WITH THIS SPECIFIC group manager in this specific department without your approval for six months.
They would invariably say, “That is what we mean.” and I would reply, “Great, then let’s make the words on the page say what you mean.” And they always agreed.
P.S. Exercising the “pocket veto” also works, especially for short term projects. The “pocket veto” is where you put the contract in your pocket and tell them that you will get around to signing it after you review it with your lawyer. Especially when you are working as a consultant and the client is happy they aren’t going to rock the boot over some unsigned paperwork. However, this only works if the non-compete is a separate document from the one that specifies the pay rate.
I work in a region with a lot of different kinds of insurance companies (health, life, property / casualty). Two jobs ago, I was at one of these when they brought on a new CIO, a manager and a programmer from the same company within a week. Working with an outside consultant they also brought along software from their previous employer. I refused to sign an NDA When I left, and was asked to leave early. The new hires were eventually found out and let go within months.
My wife, an anesthesiologist, had to sign an NCA at the academic hospital where she worked. The terms were 2 years and an “adjacent county” radius. Every MD had to sign one as a requirement for continued employment. It has been enforced, but not litigated. She’s not a researcher, and anesthesiologists do not “take patients with them” when they change employers.
I know medicine is quite a bit different that most of the industries that Nick talks about, but I just wanted to point out that the use of NCAs is pervasive in medicine, as elsewhere, in states that allow them, and they are usually non-negotiable and a condition of employment.
(when my wife left that position, I was willing to spend every last cent of our savings to fight it, just on principle, since no one else has challenged it. she declined the offer.)
Thanks, Nick, for your wonderfully common sense approach to this matter.
It makes sense to either try to negotiate the terms much the way you’d try to negotiate the terms of a contract (for anything), especially since it seems some companies are using boilerplate and not revising the NDAs and NCAs to suit the job, the employee, and the situation. They’re lazy, hence the boilerplate, so it is up to us.
But I agree with MM, Robert, et al.: instead of “first, kill all the lawyers”, it should be “first, consult an employment/labor attorney”. Any kind of NCA, NDA, or contract that harms you is not in your best interests, and the money you spend to consult an attorney might be the best money you spend if his/her advice helps you decide whether to sign it, walk away, or try to negotiate better terms for yourself.
When I was laid off from my last job, the lawyer I hired to review the severance agreement noted a clause prohibiting me from working for any “affiliated” company or organization. He said the loosest interpretation of that term could mean not working for any company that had ever done any kind of business with my former employer. That would have been a LONG list.
I called HR to get clarification on what they meant by “affiliated.” They said it included only those companies owned by the parent corporation. I asked them to provide that definition in writing, and signed the agreement after they sent it.
Under that loosest interpretation, my current employer would have been on the prohibited list.
@MM: It makes sense that anesthesiologists don’t take patients with them when they change jobs. Other doctors do, not because the doctors asked the patients to come with them but more likely out of their patients’ preferences. I’ve followed my eye doctor from private practice to his new employer. I’ve also followed my PCP from one private practice to another. I remember being told “there are other doctors here who can provide care” and I replied that I liked and was comfortable with Dr. X, and since he was leaving and I wanted him to continue to be my doctor, I was following him. Other patients of his did the same. A good hairdresser is the same–and while I would find another doctor when mine retires, I’ve told my hairdresser that he can’t retire. I won’t let him! :)
NCAs in their cases wouldn’t matter if the patient/client decides to follow the practitioner.
I have signed at least 3 different NDA/non-compete agreements in the past 20 years. The first time was for a start-up company; I asked if I could negotiate any of the terms, but they refused. I went to work for them anyway, but the company then “downsized” me prior to entering bankruptcy. As part of the severance deal, they asked me to sign another NDA/non-compete but this time, I asked them to modify/narrow the non-compete, and they agreed. I haven’t had any issue with the other non-compete/NDA’s that I’ve signed.
But, I have also been asked to sign an NDA prior to the first phone interview for a company that approached me through a head hunter. It was an industrial company seeking my help with a new product, however, I found the NDA to be very broad, especially so early in the process. It included “unlimited injunctive relief..without proof of actual damages…” if any confidential information was disclosed. I requested that they add language limiting the scope of the NDA to protect me, but they refused. I, in turn, declined to pursue the opportunity further.
What is your opinion about NDA’s during job interviews, especially prior to the first, screening phone interview?
When so many companies are acquired or simply die, at what point might these agreements not matter? If a big fish gobbles up the little fish you work for, and then tosses you out, if they don’t have you sign something before they kick you out, is the agreement you signed with the previous company still in effect?
I remember signing something when we were acquired–I might even have it buried in my home office somewhere. This particular company is still in existence, so I tread carefully. But I think I see the strategy of transferring the acquired company’s employees to their own payroll before dumping them.
The company I worked for briefly after being tossed out of the big fish died about five years after I got tossed out of that one. I wonder if there is a correlation between the insistence on signing agreements and the life span of the companies insisting on it. Runs close to that stupid interview question: Where do you see yourself in five years? Answer: Is this company still going to be here in five years?
Great article. Some companies are taking the NCA/NDA to the absurd. I have been asked to sign one on a first interview? Yes, I promise not to release your canned interview questions.
From the comments, it seems as though many companies don’t understand the very reason for having a NCA/NDA in the first place.
Luckily I’ve never encountered an NCA, and the NDAs were restricted to proprietary company info, so I didn’t have a problem with them (usually before accepting employment, but a few times before an interview, even though a month later I couldn’t remember anything about the interview!).
35 years ago it was pretty common to see covenants assigning ownership of all intellectual property of any type by any means to the company on the application for employment! I wondered then if that was legal, thought it was over the top egregious, and why that eventually disappeared from employment apps. Nonetheless, I fully support legislation to restrict this nonsense.
A number of years ago, I was offered a job with a small tech company. The NCA that they asked my to sign was so broad that it would have prevented me from taking a job with any other company writing embedded software. When I balked at signing it, they told me I would have to talk to to someone in their legal department.
I walked into their lawyer’s office and explained my objections. His reply: “If I were in your position, I wouldn’t sign that either. Let’s strike out the paragraphs you object to.”
Andy: Thanks so much for posting your story about NCAs (non-compete agreements). People don’t believe me when I tell them these are very often negotiable, mainly because they’re ridiculous, and the legal people who write them know it. These employers figure no one would dare question or refuse a legal document. The lawyers go overboard and include terms and restrictions “just because they can.”
Makes you wonder how many people before you signed that thing simply because they felt intimidated.
I’d love to ask that lawyer whether he thinks it’s ethical for his company to keep using that document, and whether — now that he’s acknowledged how ridiculous it is — he’ll cancel NCAs that other employees have signed and produce a more reasonable agreement.
Or maybe the employer should just fire the lawyer who wrote it.
I received an offer from a company and along with it the NCA. It said, basically, I couldn’t work for anyone for 2 years after I left this company. I negotiating with the HR person in her office and I asked about the NCA. She brought over the company lawyer. I went through some hypothetical situations including if I worked for Raytheon doing accounting software in their nuclear waste division would I still be in violation of the NCA. He said yes. I just stood there and looked pissed. I didn’t say anything. He offered to reduce the time to 6 months and the give me an addendum of specific companies he considered their main competitors.
Then I signed it.