Budapest Post

Cum Deo pro Patria et Libertate
Budapest, Europe and world news

What to do if you're asked to sign a non-compete agreement

What to do if you're asked to sign a non-compete agreement

Tens of millions of US workers have signed non-compete agreements - knowingly or not - with their employers - and many of them may not even realize it.

Non-competes restrict where and when you can work after leaving your current job. Such agreements prohibit an employee from working for a competitor or from starting her own competing business within a geographical area for a certain period of time after leaving her job - usually between six months and two years.

In 2017, an estimated 28% to 47% of private sector workers were subject to non-compete agreements, according to the Economic Policy Institute.

Non-competes are typically used to keep highly paid executives from jumping ship and taking the company's secrets with them. They also are commonly used to prevent salespeople and others who work directly with customers or clients from taking those relationships with them when they leave, said employment lawyer Laurent Drogin, a founding partner with Tarter Krinsky & Drogin.

But increasingly over the years, even low wage workers have been asked to sign these agreements. The sandwich chain Jimmy John's, for instance, settled lawsuits brought by Illinois and New York in 2016 that alleged the chain required all employees, including sandwich makers and delivery drivers, to sign two-year non-competes. More recently, WeWork settled suits in the same two states that alleged the company made all employees, even cleaners and baristas, sign broad non-competes.

"Often the reason employers want them is a retention device. [It's] prophylactic. If people think they have an agreement that binds them and they may get sued, if they can't afford an attorney and need the job, they'll sign now and worry about it later. It's a scare tactic," said Drogin.

Many economists say such agreements suppress wages, reduce worker mobility and are anti-competitive.

Two bills were introduced this year in the Senate to ban non-competes for low-wage workers. Meanwhile, several states have passed legislation restricting how broad the terms may be and, in some cases, also have banned employers from using them on low-wage employees.


What to do if you're asked to sign a non-compete

At some point, you might be asked to sign a non-compete.

You may be informed about it when you're applying for a job, in an offer letter, soon after you start a new position, or after working for your employer for years.

Or a company may include a non-compete clause in something you must sign off on, such as the employee handbook, a bonus agreement, a confidentiality agreement or a severance agreement, said attorney Donna Ballman, who runs an employee advocacy law firm in Fort Lauderdale, Florida.


Ask questions and check your state's laws

Don't sign anything without first knowing what's in it. "Read everything your employer puts in front of you," Ballman advised.
If you see non-compete provisions, ask why you need to sign the agreement and what you're getting out of the deal.

You should be offered something in exchange for legally agreeing to restrict your future professional options and earning potential, such as extra pay, a promotion, special training for career advancement or a change in status so that you're no longer considered an "at-will" employee.

But the something "extra" you get may simply be keeping your job. "In Florida and in many states, an employer can say 'sign or you'll be fired,'" Ballman said.

In some states, though, such as Pennsylvania and Massachusetts, employers must provide you with something more than merely being able to keep your job, said Sidney Gold, an employee-side employment lawyer in Philadelphia.


Get outside advice

If possible, hire an employment lawyer who represents employees to look over the agreement before you sign anything.
If that's too expensive and other people in a similar position at the company are being asked to sign the same agreement, you might consider pooling money to hire a lawyer to review the agreement for the group.


Try negotiating terms

See if your employer is willing to negotiate any elements of the non-compete - e.g., shortening its duration or narrowing the geographic area to which it applies or more narrowly defining what the company means by "competitor" or "customer."


Don't assume your employer won't come after you

The fear with a non-compete is that if you violate it, the company will sue you.

No one can guarantee they won't. But employers don't always go to court over non-competes. "They look at it on a case-by-case basis," Gold said.

He said they're likely to pursue litigation, for instance, if you take the client list and start your own business.

If you go work for an established competitor, your former company may initially just send a cease-and-desist letter to your new employer, which in some instances could result in your being fired from your new job.


How to reduce the chance of a lawsuit

Before accepting a job with a competitor, send an email to whomever makes decisions on non-competes - it might be HR or someone else - alerting them to the offer and explaining why you believe it would not violate your non-compete, Ballman suggested.

"Then say, 'Unless I hear from you within 72 hours, I'll assume you agree and I will accept the position.' Send the email with a request for delivery and read receipts," advised Ballman.

You'll get one of three responses, she noted. The first is "No, we'll sue," in which case call a lawyer. The second is, "No we don't care, go ahead." And the third is, "We don't want to lose you. What can we do to get you to stay?"

If you don't get any response, Ballman added, send another email saying you assume they agree so you plan to give notice in two days. That gives them one more shot to get back to you. "Is that a total defense in court? No, but lack of good faith in enforcement is a defense. And you've shown you did everything [to give them an opportunity to respond]."

Whatever you do, Gold stressed, don't accept a job with a competitor clandestinely and hope for the best, because courts generally don't look kindly on deception. "Transparency solves a lot of problems," he said.

AI Disclaimer: An advanced artificial intelligence (AI) system generated the content of this page on its own. This innovative technology conducts extensive research from a variety of reliable sources, performs rigorous fact-checking and verification, cleans up and balances biased or manipulated content, and presents a minimal factual summary that is just enough yet essential for you to function as an informed and educated citizen. Please keep in mind, however, that this system is an evolving technology, and as a result, the article may contain accidental inaccuracies or errors. We urge you to help us improve our site by reporting any inaccuracies you find using the "Contact Us" link at the bottom of this page. Your helpful feedback helps us improve our system and deliver more precise content. When you find an article of interest here, please look for the full and extensive coverage of this topic in traditional news sources, as they are written by professional journalists that we try to support, not replace. We appreciate your understanding and assistance.
Newsletter

Related Articles

0:00
0:00
Close
IMF Upgrades Global Growth Forecast as Weaker Dollar Supports Outlook
House Republicans Move to Defund OECD Over Global Tax Dispute
France Opens Criminal Investigation into X Over Algorithm Manipulation Allegations
Trump Steamrolls EU in Landmark Trade Win: US–EU Trade Deal Imposes 15% Tariff on European Imports
ChatGPT CEO Sam Altman says people share personal info with ChatGPT but don’t know chats can be used as court evidence in legal cases.
Intel Reports Revenue Beats but Sees 81% Rise in Losses
Politics is a good business: Barack Obama’s Reported Net Worth Growth, 1990–2025
UN's Top Court Declares Environmental Protection a Legal Obligation Under International Law
"Crazy Thing": OpenAI's Sam Altman Warns Of AI Voice Fraud Crisis In Banking
The Podcaster Who Accidentally Revealed He Earns Over $10 Million a Year
UK Government Considers Dropping Demand for Apple Encryption Backdoor
Japanese Man Discovers Family Connection Through DNA Testing After Decades of Separation
Russia Signals Openness to Ukraine Peace Talks Amid Escalating Drone Warfare
Switzerland Implements Ban on Mammography Screening
Pogacar Extends Dominance with Stage Fifteen Triumph at Tour de France
President Trump Diagnosed with Chronic Venous Insufficiency After Leg Swelling
CEO Resigns Amid Controversy Over Relationship with HR Executive
NVIDIA Achieves $4 Trillion Valuation Amid AI Demand
Tulsi Gabbard Unveils Evidence Alleging Political Manipulation of Intelligence During Trump Administration
Centrist Criticism of von der Leyen Resurfaces as she Survives EU Confidence Vote
Trump Announces Coca-Cola to Shift to Cane Sugar in U.S. Production
FIFA Pressured to Rethink World Cup Calendar Due to Climate Change
Zelensky Reshuffles Cabinet to Win Support at Home and in Washington
"Can You Hit Moscow?" Trump Asked Zelensky To Make Putin "Feel The Pain"
Church of England Removes 1991 Sexuality Guidelines from Clergy Selection
Superman Franchise Achieves Success with Latest Release
Hungary's Viktor Orban Rejects Agreements on Illegal Migration
Air India Pilot’s Mental Health Records Under Scrutiny
Jamie Dimon Warns Europe Is Losing Global Competitiveness and Flags Market Complacency
Moonshot AI Unveils Kimi K2: A New Open-Source AI Model
Martha Wells Says Humanity Still Far from True Artificial Intelligence
Nvidia Becomes World’s First Four‑Trillion‑Dollar Company Amid AI Boom
EU Delays Retaliatory Tariffs Amid New U.S. Threats on Imports
Trump Proposes Supplying Arms to Ukraine Through NATO Allies
US Opens First Rare Earth Mine in Over 70 Years in Wyoming
Bitcoin Reaches New Milestone of $116,000
Severe Heatwave Claims 2,300 Lives Across Europe
Declining Beer Consumption Signals Cultural Shift in Germany
Emails Leaked: How Passenger Luggage Became a Side Income for Airport Workers
Polish MEP: “Dear Leftists - China is laughing at you, Russia is laughing, India is laughing”
Western Europe Records Hottest June on Record
BRICS Expands Membership with Indonesia and Ten New Partner Countries
Elon Musk Founds a Party Following a Poll on X: "You Wanted It – You Got It!"
China’s Central Bank Consults European Peers on Low-Rate Strategies
France Requests Airlines to Cut Flights at Paris Airports Amid Planned Air Traffic Controller Strike
Poland Implements Border Checks Amid Growing Migration Tensions
Emirates Airline Expands Market Share with New $20 Million Campaign
Amazon Reaches Milestone with Deployment of One Millionth Robot
Yulia Putintseva Calls for Spectator Ejection at Wimbledon Over Safety Concerns
House Oversight Committee Subpoenas Former Jill Biden Aide Amid Investigation into Alleged Concealment of President Biden's Cognitive Health
×