CleverStart

If you ever worked for a technical company, one of the first things that they may have you do is sign a non-compete which pretty much states that you will not work for a competitor or solicit the companies employees if you quit or are fired. One thought that always went through my mind is that they really can not control you when you leave the company. If you quit or get fired, the previous company has no right to tell you who you can or can not get employment from. But how would this hold up legally?

It doesn’t and is a really a relic from the dot-com boom when companies on the cutting edge wanted a way to keep their employees. What it meant then was that a company like Microsoft could safely hire people to make technology for them and have a way to ensure that technology would stay private or unique.

At one of my former employees, their non-compete stated that you couldn’t hire someone that quit after you did for a period of one year! A buddy and I started my first company and we both worked at this place of employment. So when we read this, we were like how are we going to do this? One of us would be technically hired by the other and thus directly violating the non-compete. Well after talking to our lawyer, the simple solution was to quit on the same day and at the same time. Thus making that part of the non-compete invalid since we were both unemployed at the same time.

In the last week, California Supreme Court ruled that companies can not restrict employees from employment. So this means that the non-compete is now pretty useless when it comes to hiring or firing.

As it stands now, a non-compete is still useful when signing them with contractors but will that be going away soon? If CleverStart builds a restaurant application for a client and signs a non-compete, according to California that non-compete is void and that restaurant can not prevent me from future employment.

While California is the only state at the moment to enforce this, I see this spreading to the rest of the US soon.

You can read more about this at: news.cnet.com/8301-1001_3-10010724-92.html