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I signed a non-solicitation of employees agreement with my former employer. One of the former employees quit their job....

Littleton, CO |

I have started my own business and this employee has contacted me about working for me. The language in the agreement states:

"During the period of employment and for a period of one year following termination of the employee's employment, employee shall not directly solicit, encourage, or induce any other employees of the Company to terminate employment with the Company or employ or offer employment to any such employee of the Company."

Considering I did not contact this person or induce him to quit his job, am I allowed to legally hire him? Please notice the language of the contract states "employee" it does not say former or past employee?

Attorney Answers 3

Posted

You are missing this part "... or employ or offer employment to any such employee of the Company." As is the case with the vast majority of legal questions, those can't be accurately answered based merely off of a few sentences posted on the internet. Here's what will happen if your business is sued (and this is not a slight chance depending on the position of this former employee and their access to certain information). The former employer will move quickly to get an injunction on this action. They will also throw any number of claims against your business depending on trade secret and other issues. The court must review the entire contract terms and the relevant facts. It does not merely look at one clause in isolation. Your job is to be prepared for this and be in the best position for defense and a good offense.

Now, Colorado court's are rather hostile to these kinds of broad clauses and they often take a very dim view on their application. Again, facts are everything and something as simple as the title of this contract and other facts will be critical to prevent the injunction from being allowed. Better yet, you have an attorney send them a letter in response to the inevitable threat they will send your business. Hopefully that will stop them in their tracks or, if not, it sets a good basis to try to move for attorney fees.

Whenever--and I mean whenever--you are starting a new business and you have a restrictive covenant from your former employer, you need legal advice to be able to understand the risks. Depending on the history of this employer on moving on these kinds of things, you are doing yourself and your business a huge benefit to get legal advice so you can be prepared and understand the issues and risks. Good luck with your new venture! If your new business has several "partners", I hope you have a complete and well written operating or shareholder's agreement in place.

This answer is for informational purposes only and is not legal advice regarding your question and does not establish an attorney-client relationship.

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5 lawyers agree

11 comments

Asker

Posted

Yes, i understand all of these facts but you missed the point of the question. The question has to do with hiring one of their former employees as opposed to their current employees, would you mind re-reading the question?

Robert John Murillo

Robert John Murillo

Posted

Is that clause you quoted one that you agreed to?

Asker

Posted

yes that is the exact language

Christopher Daniel Leroi

Christopher Daniel Leroi

Posted

Great analysis by Mr. Murillo

Robert F Gauss

Robert F Gauss

Posted

I agree with Mr. Murillo, if you read the language there is an "or" that I dont think you are interpreting properly. fwiw I read the sentence the same way Mr Murillo does, though as he also states we don't give formal legal advice on line after a few sentences.

Robert F Gauss

Robert F Gauss

Posted

Looking at is I also see what you mean about "employee" however, here again, it needs legal interpretation and real thought.

Asker

Posted

I am not sure how any analysis can be considered great when it fails to address the direct question asked? If language in a contract states "employee" that obviously implies current employee, not former employee. That was the question I was trying to address?

Robert F Gauss

Robert F Gauss

Posted

The analysis is pretty good even though it may miss the direct question, because Mr. Murillo is informing you quite correctly I think that the facts behind a judge's interpretation matter. Whether you can correctly rely on the fact that the clause is written "employee" not "former employee," in order to accomplish your goal may well depend on : how techincal is the skill involved, how much access to trade secrets and what not do each of you (yourself and your prospective hire) had or have, etc. Fairness and the effect on the workforce may well mean the difference between the contract being interpreted this way or that, or whether a court is going to find the clause enforceable at all, or whether a court will believe it happened as you say, he quits independent of your earlier quitting, finds out you have a new business in the area and applies, "the immaculate hiring"- right? It's tough stuff. Best thing to do is consult a business lawyer who does this stuff regularly. There may be a different result for say lawn mower job than there would be for highly technical software position. I'm not sure a lawyer can say "go ahead" you'll be fine because it says employee not former employee. No one would want to say that to you then watch you have a two year costly litigation over it, Mr. Murllo's point is well taken though he may not have given a direct opinion.

Asker

Posted

Thank you, now that is a good response, addresses the direct issue but also informs of the risks involved

Robert F Gauss

Robert F Gauss

Posted

You are welcome, but I do urge you to see someone who does this stuff regularly. You may be absolultely correct, and it may be the case that the clause is written that way precisely because courts found use of the words "or former employee" in such a contract and situation unenforceable, a business lawyer who does this stuff regularly ought to know.

Robert John Murillo

Robert John Murillo

Posted

This was your question: "Considering I did not contact this person or induce him to quit his job, am I allowed to legally hire him?" That is why I answered as I did.and this sentiment was confirmed by Mr. Gauss and would be the same that any experienced attorney would state. You are asking for legal advice based on posting one clause. The relevant law and facts in this issue may entail trade secret, various doctrines under common law, this agreement, and other relevant documents (such as employment manuals and policies, for example). It is complex and no attorney with any sense would advise you "yes, you can legally hire based on that one clause." Now, based on your very limited facts, you may have a good basis to claim this does not covenant should not apply. I focus on the "may" because it really depends on review of the entire agreement and many more facts. As I noted, I wish the best for your venture and that you find a business attorney who can guide you as you proceed and grow.

Posted

Based on the language in the non-soliciation agreement you would be buying yourself a lawsuit by employing this employee during the 12 month period. My colleague is correct. The employee who quit or you could approach the previous employer about allowing a waiver; but if they say no, you are ill advised to hire the person. Talk to a local employment attorney.
Best of luck.

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Posted

Based upon the quoted language provided you would be well counseled to not hire this person. If you feel that this particular employee's contribution to your company would be invaluable there may be an opportunity for you to request an exception from this non-solicitation. This happens often. I would strongly encourage you to seek the advice of an attorney to address these issues for you.

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