Rules of engagement after termination

August 9, 2010 7:51 PM

Is there a rule stating that during a period after an individual's employment has terminated, he/she can not contact a former client or prospect of the former company?

If so, how long is this period? Under what circumstances is it OK to engage?
It just seems to me that such a rule would exist in some form or another, but I don't know much about it.

posted by anonymous to Work & Money (13 answers total)

it would depend too much on where you are and what industry you're inquiring about. for instance, if you're in the US and not in california, there's a pretty good chance you signed a non-disclosure agreement that covered this very action. your employment contracts should have some details.
posted by nadawi at 7:55 PM on August 9, 2010

Those things are usually codified in non-compete agreements. The last place I worked, I had to sign one when I was hired, which stated I would have to wait six months before I could try to steal their clients (paraphrasing lengthy legalese).

Wikipedia on the subject.
posted by Gator at 7:55 PM on August 9, 2010

i meant non-compete. my non-disclosure and non-compete have usually been the same form.
posted by nadawi at 7:56 PM on August 9, 2010

This is something that would be in an employment contract, not in the law. See non-compete agreements. See non-compete clause and non-solicitation agreement.
posted by If only I had a penguin... at 7:57 PM on August 9, 2010 [1 favorite]

Depending where you are, it may be referred to as a restrictive covenant, such as in Canada.
posted by Lemurrhea at 8:04 PM on August 9, 2010

It is absolutely impossible to answer this question without knowing the jurisdiction and the circumstances.

Even if there aren't written restrictions (the treatment of which would vary depending on juridiction, circumstance, and language), there are plenty of ways for an employer to come after its former employee for such conduct (torts like interference with contract, breach of fiduciary duty, common law confidentiality protections, conversion, etc etc etc).

I know that people get tired of this, but contact an attorney in your jurisdiction.
posted by seventyfour at 8:06 PM on August 9, 2010 [1 favorite]

I thought that would only be applicable if you signed a non-compete clause or similar in your employment contract. I've never heard of any laws though that pertain to non-contact outside of a specific clause in the contract (of course that doesn't mean they don't exist and I don't know US laws, IANAL etc)
posted by 1000monkeys at 9:17 PM on August 9, 2010

In some industries, it is commonplace for people leaving a firm to take (some) clients with them. For example, law (where the principle of client choice makes it difficult to enforce non-compete) and advertising (c.f.: Season 3 of Mad Men).
posted by mhum at 9:45 PM on August 9, 2010

Under what circumstances is it OK to engage?

Where I live in we have what's called "separation periods" for public servants and public officials. They're meant to manage perceived or actual conflicts of interest. It'd very definitely not be OK to be engaged as a lobbyist or employee, or establish a business in the private sector, if one has had a role in making public sector decisions or making public policy.
posted by Fiasco da Gama at 10:38 PM on August 9, 2010

At a company where I worked in the U. S. an employee who had purportedly signed a non-compete clause, who had served the employer at least adequately to my knowledge, was fired after personality conflicts and a heated argument with the management. The fired employee immediately took a job with a competitor, called every former client he had worked with, and succeeded in converting a large percentage of them to be customers of his new employer. To my knowledge the first employer took no legal action against him. The office rumor was that because he'd been directly deprived of his ability to earn a living by a sudden and not particularly justified termination it was anticipated that the non-compete clause would be difficult to enforce. I am not a lawyer and this obviously isn't legal advice.
posted by XMLicious at 12:54 AM on August 10, 2010

In New Zealand you can be prohibited in your contract from doing this but generally if and only if you're explicitly remunerated for it, independent of your normal salary.
posted by rodgerd at 3:55 AM on August 10, 2010

The non-compete clause I signed for my current employer states that I have to wait a year before working for a competitor or trying to contact clients. In my industry, a year is a lifetime. Now, I can take the same position at another software firm as long as that software is a different focus than what my current employer provides.
posted by onhazier at 5:59 AM on August 10, 2010

In the US there is a lot of litigation around non-compete contracts and some states will only enforce them if they meet certain "reasonable" requirements. If this is related to a specific situation, you should absolutely contact a lawyer.
posted by marginaliana at 7:00 AM on August 10, 2010 [1 favorite]