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Non-Compete Law

Non-Compete Law

Do restrictive covenants stifle employee productivity?

If you get paid by the hour, and not the task, is there an incentive to work any harder? Some would say, No. If you can’t take clients with you when you leave a job, or even contact them, is there any incentive to really fostering those great connections and relationships with those folks? Some…[Read More]

Why your “smartphone” keeps me in business

Dear Virginia Employee: I wanted to thank you for being glued to your smart phone. I wanted to thank you for treating that small device, owned by your employer, like it is your own. Checking your personal email, texting clients at all hours, and making disparaging remarks about your co-workers and boss in these text…[Read More]

The ‘Wizard of Oz’ approach to employment law

Today is Friday. If you are anything like me, you are making plans in your mind for the weekend. Maybe a run. Maybe some laundry. Maybe you are the person who needs some long awaited alone time in your family. Maybe you are planning on wearing your PJs all Saturday with your 18 month old, so you…[Read More]

House of Lies = House of Litigation

So I had to keep watching Showtime’s House of Lies to see what happened with Marty Kaan’s threats to open his own consulting firm in LA, in competition with his long time employer Galweather Stern. And maybe I also had to keep watching because I think Kristen Bell’s character has the best work wardrobe I…[Read More]

Lawsuits and Non-Compete Agreements

I hate noncompete employment contracts.  These contracts inhibit innovation and crush the soul (and finances) of young entrepreneurs who want to be the next Bill Gates, Steve Jobs, or even Walt Disney.  Unfortunately, these restrictive contracts are becoming more and more common. We see them in every job or profession from doctors to retail salesman to contractors to IT professionals to engineers to restaurant chefs, and on and on.

The proliferation of noncompete contracts has also lead to a dramatic increase in lawsuits.  A recent article by Ruth Simon and Angus Loten in the August 15 edition of the Wall Street Journal paints a troubling picture.  The article reports a more than 60% rise in lawsuits against employees for violating non-compete agreements during the last decade.

What does this mean?  It means there are fewer startup companies…fewer patents issued…and, fewer advances in science, medicine, and technology.

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Newscaster Tripped Up by Non-Compete

Just read an interesting article on the troubles of a news broadcaster in St. Louis, Missouri, Larry Conners.  It appears Mr. Conners made some derogatory remarks about the Internal Revenue Service on his Facebook page which his employer, KMOV and parent company Belo Corp., found unacceptable.  As a result, Conners was fired from his job.

Mr. Conners must have planned to move on to another television news show in the St. Louis area when his ex-employer reminded him of the non-compete contract he signed when he began employment with KMOV.  The non-compete contract prevents Conners from working in broadcasting in the St. Louis area for a period of one year.  Conners complained the non-compete would prevent him from providing for his family in his chosen line of work.

Conners asked, “Why would any human being want to keep someone from earning a living to support his or her family?”

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A Checklist for Hiring a Competitor’s Employees

Coca Cola hires Pepsi’s top-notch public relations manager. Dunkin’ Donuts snags Starbucks’s chief financial officer. Yahoo steals away Google’s vice president for search products.

Fictional or not, doesn’t it sound kind of fun to consider hiring the star employee of your competitor? The mere suggestion of poaching a rival’s talent pool is both thrilling and scary. Thrilling because there is a great potential to boost business. Scary because if you approach a competitor’s employee the wrong way, you could find yourself embroiled in expensive litigation that keeps you occupied for years.

If you want to hire a competitor’s employees, here’s a quick checklist.

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Virginia Doctors and Employment Agreements

Is medical school fun? Easy? Inexpensive? My friends tell me the answer to all three questions is no, no, and no. So why do so many doctors willingly give up their legal rights to practice medicine by signing non-compete agreements?

Sadly, many physicians sign such restrictive contracts without realizing the future consequences. Either they do not fully appreciate the meaning of their employment contracts, or they feel they have no other options. You must agree to egregious non-compete with hospital X if you want the job, right? Wrong.

We hope Virginia physicians will contact us before they sign non-compete agreements. We can help refine, amend and hopefully craft a document that protects everyone’s rights – including yours as a doctor.

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Physicians and Non-Compete Contracts

We are often asked by Virginia health care providers to review an employment contract that contains a non-compete clause.

If reasonable, these restrictive clauses are upheld by courts in Virginia. The best way to deal with the potential future problem of the effects of a non-compete contract is to negotiate the terms up front before signing the agreement.

I ran across an article titled, ” Negotiation Tips For Non-Compete Clauses In Physician Employment Contracts,” published by the Pennsylvania Medical Society.

The article provided the following points for Virginia doctors to consider before signing a non-competition or non-solicitation agreement that would restrict their right to practice medicine.

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“Blue Penciling” in Virginia

Remember in 4th grade when your teacher started grading your assignments with a red pencil? She was correcting your work, stating, “This is wrong.” A check mark meant an answer was correct.

What if your teacher had re-written your answers instead – giving you credit but unilaterally changing your answer from X to Y? Would that make sense? Would that be fair? Would the teacher be consistent and re-write everyone’s papers the same or would she have the choice to pick and choose?

Seems like a ridiculous example but I want you to hold it with you when you hear about judges being asked to “blue pencil” portions of employment contracts.

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