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Non Disclosure Agreements & Non Compete Clause

By Why Me Worry? ·
I was approached by a technical consulting firm who has a short term assignment available, but to become a subcontractor of theirs, they want to me to sign an NDA with way too much legal verbiage in there and something to the extent that I cannot solicit business or accept employment from their "customers" for 2 years. How am I to know who their "customers" are and if my contract ends as a consultant with this agency, why should I not be able to accept an offer of employment from these companies. Say I accept a job offer from company XYZ, and company XYZ happens to be a customer of ABC consulting services, for which I signed a contract preventing me from being employed with company XYZ. I don't need the legal headaches and I don't want to screw my own opportunities for employment. Are these NDAs' and non-complete clauses even legal? It looks as if they are worded to give the impression that they violate our basic constitutional right to employment of our own free will. Has anyone been in this situation where an NDA was required to work as a consultant? I am very weary of signing it for fear that I may hurt my career by not being allowed to legally seek work from certain employers.

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NDA - Yes, Non-compete - maybe

by jdgretz In reply to Non Disclosure Agreements ...

It's not unusual to have an NDA as part of an employment package, and I see nothing wrong with this, especially if the company you might go to work for has developed some spiffy software that you may have a peek at the inner workings of.

Non-compete on the other hand gets a little more tricky. Of course they don't want you soliciting their customers out from under them, but if it's too broad then it definately puts you at a disadvantage. I might suggest that they specifically name the company you will be working for in the non-compete portion. Something on the lines of "subcontractor will not solicit business from or accept employment from XYZ or any other client of ours with whom we place you on assignment." This covers them as well as keeping you out of trouble for inadvertently going to work for one of their clients with whom you never had contact or knew of.

jdg

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Their wording is different

by Why Me Worry? In reply to NDA - Yes, Non-compete - ...

They state that for 2 years I would not be able to solicit their "customers", yet they won't provide a list of who their "customers" are. If I am not on assignment with this agency, then why should I still be bound by this contract?

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Run Forest, Run!

by julio In reply to Their wording is differen ...

Here's my story.....

TekSystems hooked me up with a contract position with IBM at a large transportation company. I signed a non-compete which stated that I could not work for IBM "or any other company in the building." After 3.5 years of this (they made PLENTY of money off of me), I got an offer from the transportation company because they were insourcing the IBM functions. Tek decided to sue me for breach of contract. Mind you, Florida is a right to work state and I have already determined that my contract was not enforcible, but the spirit of the contract was that I could not work for another contract company at an IBM facility, not that I could not work for IBM's customer. At the time, there was not even a relationship between the transportation company and Tek.

The transportation company stepped in and worked out an arragement with Tek that ended up costing me about $10,000 due to lost bonuses, vacation, health benefits, 401k, etc.

If you are going to sign a non-compete, be VERY VERY specific about what you are getting into! If they won't play, go find somewhere else to work.

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Non Compete/Non Disclosure

by rwohl In reply to Run Forest, Run!

The purpose of a non-disclosure agreement is to avoid losing valuable proproprietary information to competitors or to those who would use that information to compromise financial investments in the company, project or national security.

Non competition agreements are ment to protect the employer or general contractor from predetory practices of unethical clients or their personnel who want to get services from a contractors work force with out paying the contractor for their mark-up. This agreement also protects the contractor or emnployer from employees or subcontractors who would decide to go into business by approaching a contractor or employer's current or former client and offer to work directly for that client so the contractor or empoloyer would not be paid the fee due them or to give or sell the contractor's business methods or data or work practices to a third party so they can profit from this inside information.

Both of these agreements speak to the employee or subcontractor's ethics and trustworthiness. The non-compete agreement also says: You dance at the party with the person who brings you to the party and you go home from the party with the person who brought you! The term for a person who does otherwise is "snake". No one wants a snake for a business associate!

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