The average American will have ten different jobs before the age of 40, and the number is growing. Researchers predict that today’s youngest workers will hold twelve to fifteen positions in their lifetime. Many of these job changes will not be voluntary; they will occur due to unexpected layoffs or terminations.
Job loss is highly stressful. The terminated employee is concerned about providing for themselves and their families during their search for a new job. When employers offer a severance agreement, which includes severance pay, the natural reaction is to accept quickly for fear the company will withdraw the severance agreement.
Typically, the severance agreement will contain a “waiver” clause. The terminated employee is required to “waive” all of their legal claims against their employer to get the severance pay. If the terminated worker waives their legal claims, they cannot later sue their employer, even if they believe their termination was for an illegal reason.
With more and more frequency, employees are asked to sign Employment Agreements which contain non-compete clauses, when they are hired and about to start a new job. It is common for newly-hired employees to be so excited to get the new job opportunity that they sign the Employment Agreement without reading it or understanding the long-term impact of the non-compete clause. Employees should never make this mistake.
Employees need to understand that non-compete agreements, and non-solicitation agreements prevent an employee from working for competitors of their employer or contacting the employees or customers of their employer for a period after their employment ends. These restrictive agreements can dramatically limit the employee’s ability to get other jobs in the future.
However, if you signed a non-compete agreement in the past and are considering a job change and are worried the new job may require you to violate the non-compete possibly, it’s also an excellent time to consult an attorney. Simply changing jobs and violating the non-compete agreement exposes the employee to litigation filed by their former employer. Litigation can be costly.
Not all non-compete agreements are enforceable. The courts in North Carolina and South Carolina have legal standards which determine if a non-compete is appropriate. In determining whether a non-compete is enforceable, the Courts look to the period an employee is restricted, the scope of the restriction, and the geographic area contained in the non-compete.
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