Protecting Your Investment in Employees

We at OG+S are very excited to have two new employees this year.  They are smart, capable young women who make us a better law firm.  I wouldn’t trade either of them.  But, you know what, they take a lot of my time.  There is a boatload of training that goes into new hires.  They are learning our systems, our clients, our “secret sauce.”  They are also helping us build goodwill – especially as they (hopefully) stick around for years.   

I’m not complaining. Not one bit.  I want our employees to be well-trained. I want our clients to love them.  What I am saying is that businesses put in a lot of time, money, and effort into having awesome employees and good customer relationships. All of that can be wiped away really quickly if those employees gain all of those skills, knowledge, and relationships, and quit to start working at a competitor.  All of a sudden, a business owner can feel like they just trained their competition and gave them an opening to take the best customers.  That can be gutting. 

What to do?  In some cases, it can make a lot of sense to have employees sign restrictive covenant agreements like: 1) non-compete, 2) non-solicitation, and 3) non-disclosure agreements.  Or if you want that in English, we have your employees agree that they are going to: 1) not directly compete with your business for a certain period of time in the same place that your business is doing its thing, 2) not try to steal your customers or maybe even your other employees, and 3) keep your confidential information secret.   

For each of these, we can’t just say, “Don’t compete with us ever anywhere.” They have to be more narrowly tailored than that.  We don’t want to take away a person’s ability to earn a living, but we do want to protect that big investment that the business put into them.  So we do things like describing exactly what the services are that the business is providing and where they are providing them.  If you run a veterinary practice in Wausau, WI, your service radius is likely measured in lots of miles. But if you are doing so in Brooklyn, NY, you are measuring it in blocks.  That Wausau vet office is probably seeing everything from cows to donkeys to pet bunnies.  The Brooklyn office is very unlikely to see a mule stroll in through its doors.  That means the Wausau vet may want to have a broader description of services and bigger area, but the Brooklyn vet may actually have more clients in spite of narrower offerings. Therefore, it is important to think specifically about your business, your investment, your customers when considering these provisions. 

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