Need to seek release from a non-compete agreement

[Cerpin Taxt]

So, in applying for a position with a peripheral competitor, the legal department reviewed my non-compete agreement and decided that they would/could not stand against it should my current employer seek injunction against me after I was hired.

I was told that the position is mine if I can obtain a formal release from the restrictions of the non-compete agreement.

Does anybody have any suggestions or experience with something like this?

Some details:

I call the hiring company a "peripheral" competitor because my current company only competes with the hiring company on a small fraction of the hiring company's products. In a nutshell, my company sells widgets designed for use with gadgets (that they do not sell), and the hiring company sells mostly gadgets but also some widgets.

My current company is a family-run business that does relatively well, and in taking a job with the hiring company, I would be moving out of my immediate area to the other side of the state, which is not a major market for my company's widgets. My current plans are to attempt to play for sympathy and argue to compromise on a revision to the non-compete agreement that would restrict me from competing in my current hometown, but permit me to work on the other side of the state.

EDIT: I should also add that I'm also in talks for a new job with a non-competitor where the agreement would not be an issue. I would prefer to remain in my industry, however, and take a job with the competitor. I plan to do my best to secure an offer from the non-competitor as a safety net, and then try my damnedest to get out of the non-compete so I can work for the company that's my first choice.

 

[mugs]

The thing is, if they say no you're pretty much guaranteed you'll lose your current job and you can't get the new job.

 

[GasX]

I assume you are being paid to not compete? If no money is on the table, then it is not enforceable. However, it is a big game of calling everyone's bluff, so a company may not hire you just to avoid potential repercussions - i.e. they do not want the hassle.

What you need to do is write a very simple letter to your former employer stating that you intend to go to work for a company that indirectly competes with them and that you would like to obtain a release from your non-compete. If they grant it, the checks stop, but your new job will offset that of course... Make sure you emphasize how little direct competition will take place and how little your responsibilities contribute to that competition.

 

[GasX]

note - I assumed you no longer worked for previous employer..

 

[Cerpin Taxt]

Originally posted by: mugs
The thing is, if they say no you're pretty much guaranteed you'll lose your current job and you can't get the new job.

Yeah, I know. There's another angle that might keep me employed, however. See the EDIT in the OP.

 

[Cerpin Taxt]

Originally posted by: Mwilding
I assume you are being paid to not compete? If no money is on the table, then it is not enforceable. However, it is a big game of calling everyone's bluff, so a company may not hire you just to avoid potential repercussions - i.e. they do not want the hassle.

I'm still employed with the company which holds a non-compete agreement with me.

What you need to do is write a very simple letter to your former employer stating that you intend to go to work for a company that indirectly competes with them and that you would like to obtain a release from your non-compete. If they grant it, the checks stop, but your new job will offset that of course... Make sure you emphasize how little direct competition will take place and how little your responsibilities contribute to that competition.

Hehe, well, both my current job and the next job will be sales positions, so there's no doubt that what little competition there may be would still be directly my responsibility.

 

[Cerpin Taxt]

bump - no other ideas?

 

[richardycc]

I thought if your state is an at will employment state, the non compete agreement shouldn't hold up in court, check with your lawyer, as I aint one.

 

[AlienCraft]

Originally posted by: mugs
The thing is, if they say no you're pretty much guaranteed you'll lose your current job and you can't get the new job.

:thumbsup:
Count on that.

They will not release you. They have no good reason to. Now if you had something( :camera:'s) on one of the principals it might be a different matter.

Take the non competing job, ftw.

 

[Cerpin Taxt]

Originally posted by: richardycc
I thought if your state is an at will employment state, the non compete agreement shouldn't hold up in court, check with your lawyer, as I aint one.

Yeah, my own research on the subject seemed to indicate the same. The thing is, my state is one that apparently holds-up non-compete agreements, and so is the state in which my company is headquartered.

And anyways, their corporate lawyers did their review on it already, and I'm pretty sure they retain some good ones.

 

[Cerpin Taxt]

Originally posted by: AlienCraft

Originally posted by: mugs
The thing is, if they say no you're pretty much guaranteed you'll lose your current job and you can't get the new job.

:thumbsup:
Count on that.

They will not release you. They have no good reason to. Now if you had something( :camera:'s) on one of the principals it might be a different matter.

I realize that they hold all the cards in this situation. I can't force them to do anything because I have no leverage.

I am simply planning on approaching the President, probably via email at first with a follow-up phone conversation to explain 1.) why I'm leaving the company, 2.) that I'm planning on moving to a new area which is not a major market for them, 3.) and that I'd like to be able to seek work in my field of expertise. The senior managers are all very nice people and while I'm not going to hold my breath on this one, I think I do stand a chance of achieving a compromise which will result in a revision to the agreement, not a full release.

Take the non competing job, ftw.

I may have to, and it wouldn't be bad if I did. Once the offer from that company comes in I won't have anything to lose, really.

 

[AlienCraft]

Originally posted by: Cerpin Taxt

Originally posted by: AlienCraft

Originally posted by: mugs
The thing is, if they say no you're pretty much guaranteed you'll lose your current job and you can't get the new job.

:thumbsup:
Count on that.

They will not release you. They have no good reason to. Now if you had something( :camera:'s) on one of the principals it might be a different matter.

I realize that they hold all the cards in this situation. I can't force them to do anything because I have no leverage.

I am simply planning on approaching the President, probably via email at first with a follow-up phone conversation to explain 1.) why I'm leaving the company, 2.) that I'm planning on moving to a new area which is not a major market for them, 3.) and that I'd like to be able to seek work in my field of expertise. The senior managers are all very nice people and while I'm not going to hold my breath on this one, I think I do stand a chance of achieving a compromise which will result in a revision to the agreement, not a full release.

Take the non competing job, ftw.

I may have to, and it wouldn't be bad if I did. Once the offer from that company comes in I won't have anything to lose, really.

Leaving a trail so they know where to send the wolves? You new at this?
TALK to someone first , wouldn't think leaving a trail would be prudent. Plausible deniability. Beware the TRAP DOOR...

 

[richardycc]

Originally posted by: Cerpin Taxt

Originally posted by: richardycc
I thought if your state is an at will employment state, the non compete agreement shouldn't hold up in court, check with your lawyer, as I aint one.

Yeah, my own research on the subject seemed to indicate the same. The thing is, my state is one that apparently holds-up non-compete agreements, and so is the state in which my company is headquartered.

And anyways, their corporate lawyers did their review on it already, and I'm pretty sure they retain some good ones.

you can always try to get myself fried or depends how much the new company wants you, you can get them to give you a different sounding title at the new company, ie: if your old job is sale, your new title at your new company is sales coach, teaching how to sell, etc. so you are working at a competing company, just not doing the same thing on the surface. again, check with your lawyer.

 

[Evadman]

Non-compete clauses haven't held up in any court of law that I am familiar with. But I am not a lawyer, so I may be out of the loop

 

[RKS]

Non-competes are usually adjudicated on a few factors:

1. does your new occupation 'overlap' your previous
2. geographic restrictions
3. time restraints

these factor/limitations vary according the field and local market.

The only way to 'get out' is to ask the previous employer is you have any type of a 'buy-out' or go to court and argue that the previously states factors are unfair and thus the non-compete is void/voidable.

* I am not licensed to practice law in Washington state.

 

[AlienCraft]

Originally posted by: Evadman
Non-compete clauses haven't held up in any court of law that I am familiar with. But I am not a lawyer, so I may be out of the loop

They (NCA's) are designed to keep you at bay with the implied threat of financial ruin to defend it. Deep pockets vs teeny pockets, and the overt threat of distruption of business as usual. Anything that disrupts business as usual is to be avoided.

 

[Cerpin Taxt]

Originally posted by: AlienCraft

Originally posted by: Cerpin Taxt

Originally posted by: AlienCraft

Originally posted by: mugs
The thing is, if they say no you're pretty much guaranteed you'll lose your current job and you can't get the new job.

:thumbsup:
Count on that.

They will not release you. They have no good reason to. Now if you had something( :camera:'s) on one of the principals it might be a different matter.

I am simply planning on approaching the President, probably via email at first with a follow-up phone conversation to explain

Leaving a trail so they know where to send the wolves? You new at this?
TALK to someone first , wouldn't think leaving a trail would be prudent. Plausible deniability. Beware the TRAP DOOR...

Well, I'm not saying I would do that and expect to still have a job afterwards. I would do that AFTER I'd already informed them that I'm resigning.

 

[Cerpin Taxt]

Originally posted by: Evadman
Non-compete clauses haven't held up in any court of law that I am familiar with. But I am not a lawyer, so I may be out of the loop

See, that has really been my experience as well, but the hiring company is a pretty large one (you'd recognize the name, I guarantee) and I'm working with the Director of Sales... I know they retain some expensive attorneys. I was very surprised to find that they couldn't poke holes in the agreement.

But then again, I'm not a lawyer either. :/

 

[alkemyst]

Also non-competes really depend on your level...if you are just a clerk then they are rarely enforced...if you are somewhat of a business pillar and pulling trade secrets, they are more so.

More people have been able to get out of them than be tied to them though.

 

[Cerpin Taxt]

Originally posted by: RKS
Non-competes are usually adjudicated on a few factors:

1. does your new occupation 'overlap' your previous
2. geographic restrictions
3. time restraints

these factor/limitations vary according the field and local market.

The only way to 'get out' is to ask the previous employer is you have any type of a 'buy-out' or go to court and argue that the previously states factors are unfair and thus the non-compete is void/voidable.

* I am not licensed to practice law in Washington state.

Here's a real kicker: the non-compete doesn't even stipulate a geographic restriction. Under the terms of the agreement, if the hiring company employed me to work in Australia I'd still be violating the terms. In what research I've done that would seem to mean that the restrictions are unreasonable and for that reason they can be voided... but that's not what their lawyers thought, apparently.

 

[RKS]

Originally posted by: Cerpin Taxt

Originally posted by: RKS
Non-competes are usually adjudicated on a few factors:

1. does your new occupation 'overlap' your previous
2. geographic restrictions
3. time restraints

these factor/limitations vary according the field and local market.

The only way to 'get out' is to ask the previous employer is you have any type of a 'buy-out' or go to court and argue that the previously states factors are unfair and thus the non-compete is void/voidable.

* I am not licensed to practice law in Washington state.

Here's a real kicker: the non-compete doesn't even stipulate a geographic restriction. Under the terms of the agreement, if the hiring company employed me to work in Australia I'd still be violating the terms. In what research I've done that would seem to mean that the restrictions are unreasonable and for that reason they can be voided... but that's not what their lawyers thought, apparently.

There may be other factors but the courts usually weigh the factors in totality. If the geographic constraints are too wide maybe the other lawyers found the time constraints to be so narrow that the courts would allow the non-compete.

As mentioned earlier courts really don't like to enforce NCAs and look for ways to void them. I hate to say it but maybe the new organization just doesn't want to deal with it/fight for your services.