Employee Poaching (CONT’D FROM PAGE 1 )
and continues to do the prohibited activity, the result may be additional fines for contempt of court, or even jail time in extreme cases.” Restrictive Covenants The moral of all this is clear: Businesses must take steps to ensure they do not lose valuable information when em- ployees leave for competing firms. At the same time, em- ployers need to protect themselves from costly lawsuits when poaching top performers from competitors. Protecting business interests has become more im- portant with recent changes in the work environment. The employment relationship is less stable than in the past, high level talent is in demand and recruiting is aggressive. Intellectual property—easily carried between companies— is more valuable than ever before. Customer information, pricing data, business plans, and proprietary marketing strategies are all at risk. Businesses looking to negotiate this rocky terrain have a valuable tool at their command: restrictive covenants.
Work Smarter, Not Harder
These written agreements can keep departing employees from competing against former employers, soliciting the same customers or employees, or using a former employ- er’s sensitive information for their own ends. “Most employers have confidential, proprietary, or sen- sitive information,” says Joon Hwang, Shareholder in the Tysons Corner, Va., office of Littler Mendelson, P.C., the nation’s largest law firm defending employers in labor and employment disputes ( littler.com ). “Or they may have cer- tain employees with desirable skills, experience, training, or intimate knowledge considered integral and invaluable to their businesses. Restrictive covenants, drafted proper- ly, can be a powerful tool for protecting all of this valuable information.” There are two sides to the trade secret coin. Incoming personnel must also be quizzed about any restrictive cov- enants signed at their former employer. And they must be prohibited from bringing along customer lists, marketing plans, financial records, confidential information, or any- thing else that might be determined to be the former em- ployer’s property.
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24 March 21, 2022
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