Non-compete and non-solicit clauses in Spokane: Let the worker beware

Washington is a “right to work” state, but that doesn’t necessarily give you the right to work anywhere you choose — especially not today, it seems.

In these tough economic times, the job market really is a buyer’s market. With a glut of labor trying to fill relatively few open positions, employers seem to be demanding more from the workers they hire — such as requiring them to sign “non-compete” and/or “non-solitication” agreements.

These agreements, often buried in the employment contract, should wave a red flag in the face of anyone asked to sign them. They protect the employer, but can actually harm the employee.

Signing a non-compete agreement or a contract containing one means that you, the employee, cannot compete against your employer for a period of time after leaving the company where you work.

These clauses can not only prevent you from opening a competing business, but also may stop you from accepting a job with a company deemed to be in competition with your employer. If you work as a bank teller with Bank A, you might not be able to take that manager’s job at Bank B.

Clauses like these do offer the employer some protection against company secrets’ being divulged to the competition. Non-compete clauses are quite common in sales, for obvious reasons: Salespeople with inside knowledge of a company’s products as well as upcoming promotions, information the employer deems confidential. Having a sales representative take a job with a competitor increases the likelihood that the competing company will gain access to information that could hurt the original employer.

A typical non-compete agreement will stipulate that an employee, after leaving the job, cannot work for a competitor within a specified time — usually six months. Nor can the worker start a business competing with the company; nor can he or she possess more than 5 percent of a competing company’s ownership or stocks.

A non-solicit agreement works in much the same way, by prohibiting workers who leave a job to take customers or fellow employees along with them. A hair stylist who leaves one salon for another, for instance, might be forbidden to invite clients to follow her or him to the new establishment.

Washington being a “right to work” state, you’d think that workers would be protected from these restrictions. But right-to-work laws don’t really guarantee a right to anything except the right not to join a labor union. The fact is, employers write non-compete and non-solicitation clauses with one aim: to protect themselves. Shouldn’t you protect yourself, as well?

A good lawyer can work wonders.

Non Compete Clauses are enforceable in Spokane, Washington if they are properly drafted

A good attorney can help extricate you from these types of clauses, and the binds they use to tie you. Not all non-compete clauses and non-solicit clauses are enforceable, but it takes a thorough knowledge of the statutes and case law to find their weak spots.

A client came to me in frustration, having signed a contract with a non-compete clause five to six years earlier. Having learned the ropes of the business, she wanted to open her own shop — but her employer tried to stop her by pointing to the language in her employment contract.

While talking with this young woman, I realized something that she had not: When she’d signed the contract, she was only 17 years old. Not being a legal adult at the time of signing, she could not now be held to the contract’s terms. We got the employer to drop the lawsuit.

When someone comes to me with a non-compete or non-solicit agreement in hand, I instantly begin looking for holes in the agreement.

If the worker is prohibited from taking clients with him or her to another Spokane business, what if he or she goes to work in Otis Orchards, or Spokane Valley? Perhaps the restrictions in the contract aren’t clearly written, leaving ambiguities.

Or maybe the employer has not suffered any real, practical damages from the employee’s actions, even if the contract was, in fact, breached. In that case, the employer would receive no damages, and so might be convinced to drop the suit.

To contact a local attorney to review your non compete and/or non solicitation agreement, please call (509) 927-3840 or click here.