NFT: No Hire Agreements

You make a deal where you give your notice but agree to stay on through the launch if they agree to not enforce the clause? I

has given you significant reason to be loyal to them, you shouldn't be. Do what's best for yourself and don't beat yourself up over it. I have no idea about the legal ramifications but your loyalty should be to yourself and your family, you don't owe anyone anything else.

There is usually a way around these types of clauses, but it depends on the specific language that’s in the non solicit agreement.

I wouldn’t worry, as it’s not your issue if they offer you the job. They would usually go after new company.

BC, not a bad idea. Would at least show good faith. Might be a bit awkward however.

Mook thanks for that, it's nice to hear even if I'm likely leaning that way anyhow.

Ross, that's what I thought so thanks for confirming.

It's the new company's.

Its not your responsibility to be in adherence

that he, or anyone in his company cannot poach you? If not, what’s stopping someone else in said company from offering you a position?

In your initial paperwork when first hired? If so, your current company can go after you, personally. Most cases, the company hiring you would do what they have to do legally to get you out of that agreement.

If you didn’t sign one, and it was just your old boss, then he would be Ailey on the hook.

I’ve never seen a non-compete ever bite some in the ass. Even when I’ve seen 1st hand scored ex bosses go hard after old employees.

Take the job.

Unless you signed something preventing you from working for a competitor, then your current company would have no basis to stop you. Since your former boss signed a non solicitation agreement, he would be in breach of that agreement. Your current employer might sue him and your new employer but they could not prevent you from leaving. And that would probably get settled.

So if it’s that good of an opportunity you should take it

You really aren't sure whether you want to leave.

Once you answer that question in your mind the rest will become clear.

Deep in your heart? if it doesn't matter - play both companies against each other and take the better offer. That is business ... that is capitalism. "Supply and demand" ... in this case you are both.

In comment 13999646 MookGiants said:

Quote:

has given you significant reason to be loyal to them, you shouldn't be. Do what's best for yourself and don't beat yourself up over it. I have no idea about the legal ramifications but your loyalty should be to yourself and your family, you don't owe anyone anything else.

Could not agree more. I tried playing the loyalty card with my first company and it cost me a lot of money. And this was with a good family friend.

Do what’s best for you. If your current company wants to keep you, then they need to beat the offer.

If the company had a to choose between a great opportunity or being loyal to you...I think you know what direction they would go in...you need to do the same.

so I don't see how they can enforce this. Many non-competes are over-turned in court, and this one seems weaker than most. It depends on how far your prospective employer wants to take it, but I think they should challenge it. Good luck!

would even know where you are going. Depending on their size they probably won't even investigate it, and you have no obligation to tell them.
Now if you are so far up the food chain where it will be a public announcement such as CEO or Major VP or something there might be something to worry about, but pretty much, I'd just follow the money if it is a good opportunity.
Also as others have said, any paperwork signed by your former boss isn't your issue, and if they opt to sue him, so be it.

even though you've had no part in the agreement?

How can Co A inhibit your job opportunities when they have given you zero in return?

In comment 13999863 montanagiant said:

Quote:

even though you've had no part in the agreement? How can Co A inhibit your job opportunities when they have given you zero in return?

I think it's clear that he would face no liability if he took the job. On the other hand, there could be liability on the part of the employer who did sign an agreement. Sounds a little like a non-compete with respect to taking clients from a former employer. The clients are free to leave. However, if the restrictions of the non-compete are reasonable they can be enforced. With a 1 year duration, this on first blush this does not seem unreasonable.

how people are telling someone no need to be loyal to the "team" ... do what's best for the family ..... LOL

It is the company you would go and work for that would be violating the agreement, not you. If you want to take this new job, as long as they are aware of the agreement and are willing to accept the legal/financial repercussions, you should be ok. The only problem would be if your current employer made a big stink like threatening a lawsuit and your new employer backed down. Could make things weird at your current job.

Ultimately I agree with Mook. Companies do what is best for them, employees need to do what is best for them. Do what is best for you and your family.

And Motown - I would tell OBJ the same thing! Go get your money.

and hired almost everyone from his old staff to work for him at the new company. I can see companies wanting to prevent raids like that one.

between a company and a person are usually not enforceable, but with many of these cases companies prefer to avoid legal expenses and just don't pursue it (on both sides).

is it a no-hire (poaching) agreement or non-solicitation?

if it's non-solicitation it's easy, just have the new company post the job on social media and apply like any other person would. bingo, no solicitation.

If it's no-hire I believe those are even less enforceable - if you want to roll the dice - but like others have said, you have not signed anything.

I would want a clause in my employee agreement with the new company though that says if you are forced to separate employment due to legal issues due to non-hire/non-poaching not your cause then they need to pay you one year severance.

Maybe worded by someone in the legal field.

I doubt it comes to this, no one wants an employee working for them who doesn't want to be there - unless it's a customer services role then they know no one wants to be there - so my guess is they probably wouldn't pursue it - if it's just one person.

They may eventually pursue a non-poaching agreement between the other company if it gets out of hand (but also unenforceable I believe - depending on the state).

In comment 13999943 Mike from Ohio said:

Quote:

It is the company you would go and work for that would be violating the agreement, not you. If you want to take this new job, as long as they are aware of the agreement and are willing to accept the legal/financial repercussions, you should be ok. The only problem would be if your current employer made a big stink like threatening a lawsuit and your new employer backed down. Could make things weird at your current job. Ultimately I agree with Mook. Companies do what is best for them, employees need to do what is best for them. Do what is best for you and your family. And Motown - I would tell OBJ the same thing! Go get your money.

That is cool. Being logical about it vs emotional.

In comment 13999954 Steve in South Jersey said:

Quote:

and hired almost everyone from his old staff to work for him at the new company. I can see companies wanting to prevent raids like that one.

There's a very easy way to prevent it - better pay, benefits, work-life balance etc

In comment 13999869 MotownGIANTS said:

Quote:

how people are telling someone no need to be loyal to the "team" ... do what's best for the family ..... LOL

But if it’s a football player on their “team” they are a cancer or no good bum and should stfu

The word poaching was used so I do believe it's a no hire style contract. For the person who recommended the severance clause, thank you I think that's a great idea.

I guess I'm not sure I necessarily want to leave but I am going to go where the money takes me because both companies are young with great outlooks/potential. If my current company matches the offer then I'll have a tough decision to make.

Will post updates down the line for anyone interested!

your current employer and a different company/person (who used to work for your current employer). To be valid, there had to be consideration, which I presume there was (i.e. your current employer may have paid money to the former employee; or perhaps the former employee owed financial obligations which were forgiven). Anyway, this is solely between them.

I don't know NY law - nor do I know employment law in any depth - but I'd say this kind of contract is theoretically valid and enforceable - as between your current employer and the former employee.

To give an extreme example just to make the point:
When former employee gave his notice to his employer (your current employer), let's pretend the employer sat him down and said they were worried about losing a significant number of employees to the new business he was setting up. So they reached an agreement whereas the employer paid ten million dollars to the former employee in exchange for his agreement to never hire any of the existing employees of employer.

Let's further pretend that the contract also provides that in the event ex-employee violates the contract and hires an existing employee of employer, then employer is entitled to a return of the 10 million dollars + interest as well as "stipulated damages" for breach of the contract in the amount of 1 million dollars for each full month that any employee works for the ex-employees new business.

Lastly, let's pretend the contract provides that employer is also entitled to file an injunction seeking specific performance of the terms of the contract.

Now, if the employer filed suit trying to seek an injunction preventing you from working for the new employer, that lawsuit would be thrown out in two seconds, because you are not a signatory to the agreement.

If the employer filed suit seeking an injunction against ex-employee (your new employer), there is a greater chance the court would uphold that, but it would still be a stretch (generally courts do not like restrictive covenants that prevent someone from working and prefer to allow the employment but make it subject to monetary compensation).

That leaves us with the most likely scenario. Employer sues former employee for return of the money paid ($10 million plus interest) as well as damages as stipulated in the contract ($1 million per month) together with attorney fees.

The end result could very well be that your new employer calls you into his office the day he receives the lawsuit and says" Kelsto, I like you a lot. You know that. But that jerk we both used to work for has sued me and I can't afford the legal fees and I sure as hell can't afford the damages if I lose the lawsuit, so I'm going to have to let you go. Today. Now. I'm very sorry about that. I truly am. But, I just can't risk it. I hope we can remain friends. Bye."

Now, I'm speculating quite a bit because we simply do not know anything about the contract entered into between your current employer and the former employee. So, I'm just outlining one possible (if not likely) scenario.

I don't think it is possible for you to know your risk without you seeing a copy of the contract (unless of course you can find a way to: (i) get your current employer to agree, in writing, to permit you to work for the former employee and waiving the contract; or (ii) get the former employee (new employer) to agree to pay whatever damages the contract calls for (and he would have to show it to you).

And the Antitrust division of the DOJ as well as the FTC generally take a dim view of such agreements, considering them to violations of the Sherman Antitrust Act.

Quote:

"Companies which collude to set industry hiring and compensation standards and which enter into no-poaching or wage fixing arguments with each other will face criminal and civil investigations and enforcement." In its press release, the FTC stated: "[w]orkers are entitled to the benefits of a competitive market for their services. They are harmed if companies that would ordinarily compete against each other to recruit and retain employees agree to fix wages or other terms of employment, or enter into socalled `no-poaching' agreements by agreeing not to recruit each other's employees." *

Gary. I agree with confidentially agreements but no-hire? No way.

it really makes a ton of sense from the anti-trust standpoint. And after I wrote all that nice pretend story... haha!

In comment 13999868 njm said:

Quote:

In comment 13999863 montanagiant said: Quote: even though you've had no part in the agreement? How can Co A inhibit your job opportunities when they have given you zero in return? I think it's clear that he would face no liability if he took the job. On the other hand, there could be liability on the part of the employer who did sign an agreement. Sounds a little like a non-compete with respect to taking clients from a former employer. The clients are free to leave. However, if the restrictions of the non-compete are reasonable they can be enforced. With a 1 year duration, this on first blush this does not seem unreasonable.

But if the 3rd party involved who is the most effected by this had no part I would think that makes this null and void.
The only one who benefits from this is the original employee which makes the whole thing invalid as a real contract

not "effected"

A valid contract has to have benefit to all parties. How can someone make a contract between two parties that affects a 3rd who never signs the contract?

In comment 14000523 montanagiant said:

Quote:

not "effected" A valid contract has to have benefit to all parties. How can someone make a contract between two parties that affects a 3rd who never signs the contract?

But non-competes that affect clients who are not signatories have been enforced. Rather than prohibiting clients from leaving to the former employee, it sets up a schedule of "damages" to be paid by the former employee. As long as the duration of the non-compete is reasonable (1 year probably would be) and the damages are also reasonable it could be enforceable.

In comment 14000564 njm said:

Quote:

In comment 14000523 montanagiant said: Quote: not "effected" A valid contract has to have benefit to all parties. How can someone make a contract between two parties that affects a 3rd who never signs the contract? But non-competes that affect clients who are not signatories have been enforced. Rather than prohibiting clients from leaving to the former employee, it sets up a schedule of "damages" to be paid by the former employee. As long as the duration of the non-compete is reasonable (1 year probably would be) and the damages are also reasonable it could be enforceable.

I can see that IF Kelsto was the one who signed the "no hire" in exchange for his promotion but he didn't the guy who lest did. I'm no lawyer but to me this goes against basic contract law. The guy leaving did not benefit, Kelsto didn't benefit (unless they are claiming his promotion but then I go back to why not have him sign then for the promotion?).

The only beneficiary is Kelsto's current employer which for basic contract law makes the contract void. But once again I'm not a lawyer so who knows.

I have actually won a non-compete case back in the mid 90's. But it was because I gave them specialized training in a skill they had no prior knowledge in at a cost to myself. The non-compete had a buy-out clause of 10K and a length of 18 months. I had this tech who I took off unemployment trained him and he was making more money then he ever had in his life. Asshole tried to steal one of my largest accounts 8 months in