To Compete Better, States Are Trying to Curb Noncompete Pacts
It&#x27;s nice for some anonymous internet person to say &quot;Non compete clause? just don&#x27;t sign them&quot; but if you are ever lucky enough to get high up in a company this often just sometimes isn&#x27;t an option.<p>So if you do have to sign one then the below is the advice I&#x27;ve been given by the employment lawyer&#x27;s I&#x27;ve spoken to over the years.<p>1) make sure it says you are compensated for the time you can&#x27;t work. ie if it says you cant&#x27; work for a competitor for a year then you should be getting a salary for the same duration.  Some companies will try to give you a signing bonus and include language that the signing bonus is consideration for you waiving this compensation.  I mean it&#x27;s nice to get $50,000 in stock vested over 3 years just for signing, but it won&#x27;t feel that way if your former employer also views this as compensation for you not working for a year.<p>I&#x27;ve had 3 or 4 employment lawyers go over this with me, both as an employee and as an employer and they&#x27;ve all repeated this, if the company doesn&#x27;t&#x27; pay your salary during the non compete period then you just cant&#x27; sign it.  Now they also stressed that this means the non compete is probably not enforceable but that won&#x27;t be much consolation if they drag you to court.<p>2) Be very clear as to what &quot;salary&quot; means.  So if you are a Google engineer and you have a salary of say $125,000 and then a bonus of say $100,000 worth of restricted shares vesting over 3 years and maybe a signing bonus of $50,000 worth of shares vesting over 3 years, you might brag that you just got paid $275,000, but the company will probably argue that they only need to pay you the pro rated amount of your salary over the waiting period.<p>Finance especially gets burned by this, as small salary and huge bonuses are how many hedge funds compensate their key employees, also known as the &quot;you eat what you kill&quot; compensation package.<p>3) Be very wary of telling your former employer of where you are going to work.  There just is no real upside to it.<p>I&#x27;ve also been told not to hire former employee&#x27;s in the first year you leave for a competitor.  It&#x27;s one thing for a company to loose you, but if  you leave and take an entire team with you then even though you&#x27;ve probably done nothing wrong, it own&#x27;t be very comforting when you are out of pocket $10,000&#x27;s of dollars in lawyer fees and stress.<p>As always, IANAL, I&#x27;ve just happen to work in the most incestuous industry around, finance, and I&#x27;ve seen and heard too many horror stories of people leaving for another firm and bringing their team with them and then being in court for years.