Whose responsibility is this?

Came across an interesting issue and I'd like your input please.  

If a candidate has a non-compete or conflict of interest agreement (or both) that they signed with their present employer, how involved should recruiters be when addressing this, if at all. Obviously these documents are written for a reason and most employees will sign their life away without even reading them.  Is it solely the candidate's responsibility to negotiate themselves out of the agreement?  

In a prior gig, I was surprised when 2 companies actually filed suit.  The external recruiter basically put the onus on the candidate and left us having to deal with it.  I never really had a forum to ask about that until now.  

Has that changed at all and what's your opinion?  Thanks, in advance.

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Permalink Reply by Amber on April 6, 2011 at 4:03pm

Some clients have their own agreements that candidates have to sign basically saying that the candidate is under no type of such agreement. There are still a lot of companies that require employess to sign non-competes and/or conflict of interest agreements, and some are enforceable - or have clauses, parts, acts - that are enforceable. And even if they are not enforceable in the end, employers do not want to be involved with legal actions or lose a new hire in the end.

I do not think a recruiter is responsible for any kind of negotiating of the agreements, but I ask about them so I know because if a particular client is going to ask the candidate to sign saying that they are not currently under an agreement with a current/past employer it can be addressed up front. Between the client and the candidate. I'm not really sure what role a recruiter could play in that part.

As far as a recruiter having knowledge of it, I don't even know that many would ask, know, or care. I only ask now because of losing a placement.

Permalink Reply by Frank Zupan on April 6, 2011 at 4:41pm
I'm not a lawyer, but the way I've always viewed these agreements is as follows: The person that's obligated under the agreement is responsible for resolving the agreement and assuring any future employer that their (potential) employment is unencumbered.
Permalink Reply by Kimberly Roden on April 6, 2011 at 4:53pm

The more that I read your replies the more sense it makes that the responsibility is on the candidate to be sure they're "free" to seek other employment and if they're not, they should also bring it to the attention of the recruiter so the company can decide how to proceed.  When I dealt with this, my company basically wrote a check to release the candidate from the agreement.  

Great thinking points... thank you!

Permalink Reply by Christopher Poreda on April 6, 2011 at 4:57pm
Couldn't have said it any better than Morgan...!  As a recruiter, it's your duty to keep the parties informed, but be very careful drawing your own conclusions as to the legality or enforceability of such documents.
Permalink Reply by Tom Dimmick on April 6, 2011 at 5:02pm

Good posts from Frank,  Morgan and Amber.  Like Frank, I am not an attorney.  However; as an ex HR professional, I had the responsibility of seeing to it that non compete agreements were put into place where appropriate and those that were in place, enforced.  In general - Courts are increasingly giving the employee latitude (notice - "Latitude" not "Freedom") when the employee is able to show that the terms of the agreement prohibit them from gainful employment.  For example: My friend worked in a particular industry and the agreement prohibited him from continuing to work in that industry.  In that case, he was able to get out of the agreement. THe non compete was ruled as too broad.

 

In other circumstances where the candidate had regular access to proprietary information, particularly regarding unique technologies or manufacturing techniques, the non competes have been upheld.

 

The point is this:  Ask if a non compete has been signed.  Advise the client company that there is or is not a non compete in effect.  Obtain a copy if requested and point the candidate to an employment attorney.  Morgan put it very well.

Permalink Reply by Sandra McCartt on April 6, 2011 at 5:03pm

Agree with Morgan here.  The TPR should always ask if there is any kind of non compete.  If the answer is yes, i ask for a copy of it.  I send it to my client along with the resume for them to review before anybody wastes time on an interview.

 

No recruiter, unless they are also a licensed attorney in the state where the agreement is drawn should ever get involved with giving any advice to a candidate or a client as to the enforceability or not of a non compete. 

 

I will sometimes advise a candidate to take the non-compete or the NDA to their own attorney for an opinion before we move forward. 

 Many companies have a full legal staff so will ask that their internal legal department review the document.  If internal says go for it we can fight it and will if the candidate is a super star the client will move forward.  Normally the legal staff of the hiring company will attempt to negotiate a buy out of the non compete with the previous company.  Sometimes that works.  Sometimes they just go for it, make the hire and indemnify the employee from any legal expense should his/her previous employer take legal action.  Those things can take years to litigate and by the time it gets to court the hiring company can prove that there have not been damages to the previous company.  Or the whole thing dies from lack of feeding.  Depends on how much money either company wants to spend on legal fees and what damages the previous company can prove.

 

I have worked with candidates who were able to get their current company to certify that they would not pursue a non compete depending on location of the new position or in the event that the current company was shutting down a specific business platform so would no longer be in that verticle or massive layoffs were going on but each situation is very different so we must ask and we must disclose.  A sale of a company can sometimes put a non compete signed with the acquired company in question if a new one was not signed.  Getting that information from the candidate is also good info to pass on along with the copy of the non compete.

 

 It is very disappointing to forget about the possibility of a non compete and have a client get to the point of offer only to have a non compete pop out of the woodwork that prevents a hire.

Permalink Reply by Gerry Crispin on April 6, 2011 at 5:03pm
As a former recruiting leader for a Fortune 50 pharma firm, I made sure that the script for every recruiter who hired critical skills included an early question (if not THE first question) "Have yousigned a non-compete?" If the answer was "yes", the script required one more question- "When is its end date?" That date was attached to the name and the recruiter politely closed the conversation. (Exception was made for California at the time). a third party recruiter who brought me a candidate with a non-compete would no longer be welcome with any candidate.
Permalink Reply by Sandra McCartt on April 6, 2011 at 5:39pm

That is interesting Gerry.  I have a lifescience client who wants to see every non-compete that comes with a candidate for their sales staff ,R & D group and physicians.  When i asked them about sending candidates who were under non compete they said, "Send them and send a copy of the non compete."

 

It would seem prudent to ask the recruiting leader how they feel about it so you don't cut your throat if there is a Crispin at the wheel.  :)

Permalink Reply by Gerry Crispin on April 6, 2011 at 8:05pm
Agreed. Waste of time for my money and the data I collected then. Better to collect expiration dates and tap the mine when its ready to give up its ore. I take the long high road...and this from someone personally sued for taking an entire scientific team from 3m
Permalink Reply by Sandra McCartt on April 6, 2011 at 9:06pm
Broke you of sucking on the non compete egg did it.  What was the final dispensation of the law suit?
Permalink Reply by Gerry Crispin on April 6, 2011 at 9:47pm
Won hands down. It was in the days when we actually fought the good fight. (They didn't have a non compete- their employer just was pissed I picked off the entire team)
Permalink Reply by Lisa J. Green on April 21, 2011 at 3:18pm

I just saw this discussion and even though I'm a day late (and usually a dollar short), I'm going to reply anyway. I had several consultants who signed contracts with a 12 month non-compete clause in them. The non-compete was very specific and stated that the contractor could not work for "current client(s)" at "client site(s)"...that was the extent of it.

For informational purposes only, I am sharing what my attorney advised me to put in place. I live in Virginia and my attorney advised me not to put any longer than a "12 month non-compete" in the contract and to only include the client(s) and their site(s); his reasoning was fairly simple and logical - the courts do not like greed. If you try and keep a person from working too long, from working for other clients, or at other client sites, you are likely to lose should you ever go to court.

I hope this information is helpful.

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