Noncompete agreements: Ending employee bargaining power

Could a noncompete agreement lurking in your employment contract prevent you from doing the only job you’ve ever done, even if you don’t have any special knowledge or only work a blue-collar job?

Many are astonished to find out that they’re barred from taking their work experience and using it to find a better-paying job — which is exactly why experts believe that companies are starting to enforce them.

While noncompete agreements are routine and generally accepted by senior executives, experts say that more and more companies are starting to extend the agreements down into the lower ranks.

Executives with access to proprietary information and knowledge of their former company’s innermost workings and weaknesses could exploit these vulnerabilities if they suddenly switch gears and start working for a competitor.

Having entry-level employees bound by noncompete agreements leaves the employer with control of all the bargaining chips. If the employee bails, he or she must start a new career at the bottom rung. The other alternative is to wait out the terms of the noncompete agreement — which can be several years.

That reality effectively traps many employees in their present positions. These agreements cripple the mobility of the workforce. Employees are forced to accept lower wages and poor working conditions instead of using their experience as a way to better their situation.

Many workers currently trapped in noncompete agreements didn’t even understand what they were signing when they first got hired. Also, companies have gotten even more restrictive with the type of agreements that they often foist on newly-hired employees — who really have little choice except to sign the agreement or go back into the pool of job seekers after turning down any other prospects.

Companies also use variations of noncompete agreements, including nondealing and nonsolicitation agreements that prevent employees from networking through their old contacts and customers. They also use nonpoaching agreements that prevent employees from leaving and starting up their own firm with coworkers or recruiting someone they know from work for another position in another company.

Noncompetes are not always enforceable — but it may take legal help to reach that determination or defend your position in court. If you’re concerned about whether or not a noncompete agreement could stop you from pursuing your livelihood on the open market, talk to an attorney today.

Source: seattletimes.com, “Noncompete agreements spread, cutting off the right to a new job,” Conor Dougherty, May 23, 2017