On many occasions, an employee or executive will approach me after leaving an employer with a letter in hand. The letter – from the former employer – demands the executive ceases and desists from working with a competitor or violating a non-solicitation agreement. It’s intimidating and meant to be so. Unfortunately, by this point, the employee has already made some mistakes and the scope of my representation is often to help him or her dig out of trouble.
To prevent this scenario, there are several steps to consider before quitting:
Consult an attorney before leaving your employer. If you’ve signed post-termination agreements, such as non-compete, confidentiality and non-solicitation agreements, getting legal advice is key. The attorney can then evaluate whether the agreement is enforceable. If there’s a basis for striking the contract or non-compete clause, it sometimes makes sense to take preemptive action before engaging in conduct that could be deemed by the court (after thousands of dollars in legal fees are expended) to be unlawful or perceived as unethical.
Don’t try to hide where you’re going. Some employees avoid telling the former employer anything about where they’re going. But it’s a small world out there, and employers will almost certainly find out where an employee is going, especially if it’s to a competitor. Many employers become concerned precisely because they believe the employee isn’t being honest. The employer will then be more willing to pursue a case with vigor. In general (and there are some exceptional circumstances), it is best not to make an effort to conceal where you are going after you resign.
Keep it positive. If you’re leaving to go to the competition, this one can be tough – chances are your employer will be angry. Express your gratitude for what you learned at the company and give a simple explanation for moving on. If it’s contentious, tell the employer you’re represented or have your attorney do so.
Carefully consider how much notice to give. Leaving suddenly – and leaving your employer in the lurch – can create bad will. But if you’re going to a competitor, it may be better for both you and your employer to cut ties suddenly, so you lose access to confidential information. An attorney can guide you in how much notice to give.
Reach out to colleagues. After giving your employer notice, take the time to make calls to colleagues, letting them know you’re moving on. They’ll appreciate hearing from you, even if they’ve already gotten word through the rumor mill. Again, keep your explanation for leaving simple, short and positive. This is not the time to gripe over company policies.
Do not breach your duty of loyalty. If you are employed as an employee or serve as a contractor, you have a duty of loyalty which you owe to the principal until the relationship terminates. It is important that you maintain that duty until you walk out the door for good. You may interview and take some preparative steps to leave but you should be careful about over-stepping those boundaries.
There is nothing worse than starting with a new employer or in a new business venture with the distraction of a lawsuit from your former employer. But, taking these steps can help prepare you for any legal action. It can also help you leave on terms so that the employer isn’t eager to spend money to enforce a restrictive covenant. And it’ll allow you to keep contacts that might be valuable later.
Since each employment situation is different you should consult with an attorney to consider your specific situation.
Brendan Hennessy provides consultations to businesses, executives and employees regarding employment matters. Call 484-875-3111 to set up a consultation.