Is non-solicitation the same thing as non-competition in a Separation agreement?
May 23, 2009 6:28 PM   Subscribe

[EmploymentLawFilter] Is non-solicitation the same thing as non-competition in a Separation agreement?

My severance agreement has the following paragraph:

Non-Solicitation. In exchange for the severance and other consideration under this Agreement to which you would not otherwise be entitled, you agree that for a period of one (1) year after the Separation Date, you will not, without the express written consent of the Company, in its sole discretion, (a) solicit any business that is competitive with the Company's business from any client or customer of the Company or (b) either in your individual capacity or on behalf of or through any other entity, either directly or indirectly, hire, engage, recruit or participate in any way in the hiring, engagement or recruitment of, or participate in any effort to hire or solicit, any current or future employees of the Company or any subsidiary thereof.

My question concerns clause (a). Can I work for the company's competitor if I am not employed in a Sales capacity? I do design, and have no involvement in the sales stage.

My understanding of a standard non-compete is that you can't do your job with a competitor for a given period in a given geographic location. But this paragraph is titled Non-Solicitation, and it doesn't say in clause (a) that I can't indirectly solicit business, the way it mentions in clause (b) that I can't indirectly hire the Company's employees.
posted by Dragonness to Law & Government (8 answers total)
 
This depends on your local jurisdiction. Consult competent legal counsel.
posted by dirtynumbangelboy at 6:46 PM on May 23, 2009


Response by poster: I actually posted this just after speaking with an attorney friend, albeit one who is not an employment law specialist. She suggested that I would be fine as long as I wasn't personally taking clients away from the Company.

I wanted to hear other opinions, to figure out if this is cut and dried, or if I should hire an expert.
posted by Dragonness at 6:49 PM on May 23, 2009


As I read it (and I have an HR background, not law), clause (a) says you can't try to steal any of their clients, and clause (b) says you can't plunder their staff either.

Going to work for a competitor is not anything they can (or are trying to) prevent you from doing. The fact that you're working for their competitor in a different capacity is, I believe, irrelevant.
posted by DrGail at 6:50 PM on May 23, 2009 [1 favorite]


Response by poster: I'm in MA, by the way.
posted by Dragonness at 6:50 PM on May 23, 2009


IANAL but would have come up with the same interpretation as your friend.

One other thing to consider. Are you likely to be used by your new company's sales efforts to get business? You mention design and I know in some industries the names and resumes of staff are regularly put on proposals to demonstrate capability. You may want to look into what the limitations of them doing that would be.

Personally, I'm also bewildered by the meaning in the recruitment phrase of "future employees" of a company.
posted by meinvt at 6:56 PM on May 23, 2009


Not a legal opinion, but as I read this, you are exchanging a severance package for this non-solicitation promise. It may be that if you forfeit the severance, you cannot be held to the non-solicitation promise.

Note that the wording of the non-solicitation clause is odd, ambiguous. See particularly the word "or" rather than "and" between clauses A and B. "Or" may mean one of the two clauses applied. "And" would be the proper connector if both clauses applied.

(a) solicit any business that is competitive with the Company's business from any client or customer of the Company or (b) either in your individual capacity or on behalf of or through any other entity, either directly or indirectly, . . .
posted by inkyr2 at 7:18 PM on May 23, 2009


Best answer: I am an attorney; I'm not your attorney. If this question really concerns you or if you receive a cease and desist letter from the Company, then hire a lawyer in your area.

That being said: yes, you can work for a competitor in a non-sales position. Inform your new employer of the non-solicitation clause; be wary of contacting old Company's clients and employees. Otherwise, don't sweat it. I wouldn't worry about your name being touted as a designer with the new employer; so long as you aren't actively seeking out and soliciting business from the old Company's clients, you should be fine.

If this doesn't completely answer your question, email me.
posted by LOLAttorney2009 at 7:58 PM on May 23, 2009


Response by poster: Thank you all, and especially LOLAttorney2009, this does answer my question. It only took one and a half hours to conclude this AskMe!
posted by Dragonness at 8:33 PM on May 23, 2009


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