Imagine this: You are filling a senior level position. You review hundreds of resumes, conduct dozens of screening interviews, and coordinate final interviews of the top candidates. After selecting the company’s top choice, you negotiate a compensation package and seal the deal. A week after the new employee starts, you receive a threatening letter from her former employer informing you that she has a noncompete, which bars her from working for your company. Oh, no.
Contrary to popular belief, noncompetes remain enforceable in a majority of states, including North Carolina and South Carolina. Although such agreements are often difficult to enforce, they can still cause some serious headaches for employers. Not surprisingly, the most qualified employment candidates may come from competing businesses. Before hiring a candidate who has worked for a competitor, we recommend the following:
Do: Ask candidates to disclose whether they signed any agreements with their former employer, including confidentiality, noncompetition, or non-solicitation agreements.
Do: Have employees verify in writing (perhaps in their signed offer letter) that they are not subject to any agreements that would prohibit them from working for your business.
Do: Have your attorney review any noncompete signed by the candidate to evaluate its scope and enforceability before proceeding with the hiring process.
Do Not: Accept a candidate’s assurances that the noncompete is unenforceable or that the competitor "never" seeks to enforce the restrictions.
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