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Confidentiality Agreements

deacfan78

deacfan78

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Need some insight. My wife was asked to sign one after she has worked for this company for 3 years. She basically built the department, created the contracts she uses, built the client relationships, etc...

They are doing her dirty now and she is looking for another job, but does not want to sign something that would put her in jeopardy if she maintains some of her client relationships. The new job would benefit from her client relationships without hurting the company she is leaving.

Should she consult an attorney to look at the agreement?
 
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Yes, consult with an attorney. Laws vary by state, but in NC there needs to be consideration to support a confidentiality agreement. Usually the consideration is the job you are being offered, since it is normally signed when you start a job. So in this case, there would need to be $$$ to make the agreement a binding contract.
 
She doesn't want money. She just essentially wants to be able to keep relationships with the clients she has and contact them in the future if her services fit a need of theirs that is in a similar realm of business (but not exact) that she does for the current company.
 
JerseyDeac said:
Yes, consult with an attorney. Laws vary by state, but in NC there needs to be consideration to support a confidentiality agreement. Usually the consideration is the job you are being offered, since it is normally signed when you start a job. So in this case, there would need to be $$$ to make the agreement a binding contract.
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No, you don't need additional consideration for a Confidentiality Agreement, only a Non-Compete. Not sure exactly which he is talking about here.
 
Yeah, confidentiality and non-compete are two different things and are typically governed by different sets of laws, which are usually very state specific.

Usually non compete clauses have to be drafted very specifially in order to be enforceable. It varies greatly from state to state, but typically there must be limitations on geograpy, time and scope of activities in order for a non-compete to be enforceable.
 
I guess. Its all wrapped up in the Confidentiality Agreement. The agreement her current employer asked her to sign is vague and reads like that no matter what she does next, she can't contact her current clientele even if she was offering a completely different product/service. It also includes not sharing financial information about the company, current recipes (which she has no knowledge of anyway), client files, etc...

She is catering sales manager now, but has an opportunity to leave there and be an event manager for an event management company with an option to buy the company. The clientele would be similar, but she would be offering different services. The event management company does not handle catering, but she might need to hire a caterer if the client request her to handle that aspect.

The way the agreement reads, she could be sued for taking business away from her current (hopefully soon to be former) employer, even though techincally she would not be, especially since she is offering a different service from what they offer and they cannot offer. She would not be contacting current clientele to sale catering, she would be offering event management of all aspects.
 
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deacfan78 said:
I guess. Its all wrapped up in the Confidentiality Agreement. The agreement her current employer asked her to sign is vague and reads like that no matter what she does next, she can't contact her current clientele even if she was offering a completely different product/service. It also includes not sharing financial information about the company, current recipes (which she has no knowledge of anyway), client files, etc...

She is catering sales manager now, but has an opportunity to leave there and be an event manager for an event management company with an option to buy the company. The clientele would be similar, but she would be offering different services. The event management company does not handle catering, but she might need to hire a caterer if the client request her to handle that aspect.

The way the agreement reads, she could be sued for taking business away from her current (hopefully soon to be former) employer, even though techincally she would not be, especially since she is offering a different service from what they offer and they cannot offer. She would not be contacting current clientele to sale catering, she would be offering event management of all aspects.
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sounds like a non-compete. your bill is in the mail.
 
P4nthers11 said:
sounds like a non-compete. your bill is in the mail.
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I will have to look at it again, but I'm pretty sure it says "Confidentialty Agreement" at the top. Does that matter? If she signed it and keeps on keeping on and they try to sue her could it be argued that it was a confidentialty agreement not a non-compete?
 
What's the BFD? If she's going to take the other job, take it today and don't sign the agreement.
 
Grief. No, it doesnt matter what it says at the top. It sound like you have non-compete provisions in your 'confidentiality agreement'. Regardless, whatever state you are in has specific laws that deal with both types of agreements. It sounds like you care more about the non-compete provisions, so it would be advisable to have an instate atty look at those and give you an opinion on enforceability.

As a generality, I dont think they would have a good argument for trying to bar her from performing services for a future employer that she does not currently perform for the existing employer, but who knows what your state law says.


Generally, a decent non-compete will have to say something like:

"Employee A is barred from providing food catering services (specific activity), within 25 miles of Company A (reasonable geographic limitation), for a period of 2 years (reasonable time limitation)."

Again, every state has different laws.
 
HeavyPetter said:
What's the BFD? If she's going to take the other job, take it today and don't sign the agreement.
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This. Non-comp and confidentiality agreements usually take place at the beginning of employment not the end.
 
ONW said:
This. Non-comp and confidentiality agreements usually take place at the beginning of employment not the end.
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She doesn't plan on it, but I guess they are threatining employment. The other opportunity won't be available until September 1. We'd like to have the pay until that starts.
 
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deacfan78 said:
She doesn't plan on it, but I guess they are threatining employment. The other opportunity won't be available until September 1. We'd like to have the pay until that starts.
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I understand your concerns, but if she hasn't signed anything already, that's on them, not her. Converting the new opportunity into a guarantee would put this issue and worry to rest.
 
It sounds like a non-compete. The first thing to do is make sure she has contract from the new employer.

If they really press her on it, she should say she wants her lawyer to look at. That should get her a couple weeks of pay.
 
I have no real knowledge or expertise other than my dad is a lawyer and he typically says things like this rarely hold up in court and are mostly meant to scare people. I have no idea if this is actually true.
 
deacfan78 said:
She doesn't plan on it, but I guess they are threatining employment. The other opportunity won't be available until September 1. We'd like to have the pay until that starts.
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Is she at-will or under contract? If she does have an employment agreement, I'd check to see what it says about termination. Unless it is extremely general in nature, I have a hard time believing that refusal to sign a non-compete could be grounds for termination.

Regardless, she should talk to an employment lawyer before she signs anything. It really shouldn't cost much.
 
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