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I have just recieved an offer for a job I am very interested in, but looking through the documents I would have to sign, I noticed that they are also expecting me to sign a Non Compete / Non Solication agreement, something which I have never signed for any of my other jobs. The condtions are 6 months of Non Compete with any direct / indirect competitors and 12 months of Non Solication.

How normal are agreements like this when signing full time contracts? If I do want to switch jobs later on, how would I know if a company is considered a indirect / direct competitor? Is there a legal definition or is more of a question of opinion? How often do companies actually pursue legal action because of Non Compete clauses?

My location is Ontario, Canada.

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    What is an "indirect competitor" by their definition? As I understand the term it cuts a pretty wide swath. You might find yourself unemployable in your primary line of work if you leave. Note also that such clauses are not permitted by law in some places.
    – jwh20
    Aug 20 '21 at 18:44
  • What kind of job is this? Is this for flipping burgers at a fast food joint? Or is this for a VP of Sales position? How much money will they be giving you during those six months? Aug 20 '21 at 19:06
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    Non-competes in Ontario are hard to enforce. See shrm.org/resourcesandtools/legal-and-compliance/employment-law/… Unless you are in very high level position, they will not come after you.
    – Hilmar
    Aug 20 '21 at 20:44
  • They are extremely common. Depending on your status, and a million other factors, some terms may be negotiable. Or they may say take it or leave it. Regardless, I would go over the language in detail. Some contracts are reasonable, some are maximalist (probably just to simplify things for the lawyers working with it), and if taken literally, would limit your future ability to work on similar projects, or in the same industry if your employer's client is the "one big company". Another school of thought is sign it and ignore whatever it says (I am strongly opposed to this way of thinking)
    – Pete W
    Aug 21 '21 at 0:02
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I've had to sign a non-compete/non-solicitation for every job I've had (also located in Ontario, Canada). In general, they are very restrictive in terms of what is defined by "competition" and "solicitation".

The way most of the terms I've seen have been written is that "competition" means that you are prohibited from doing the same job for a company that is in direct competition with the company you are working for, in the same department as you were working, with similar responsibilities as to what you were working on. For example, if you worked for Amazon in their big data department, then you would be able to work for Shopify as a frontend developer, even though Amazon and Shopify are direct competitors; the knowledge and information you would have gained regarding Amazon's IP as a big data developer would not be applicable to your work at Shopify.

The way "solicitation" is usually defined is that you would be unable to use any industry contacts you made as a result of being customer-facing at one organization to help another, competing organization. For example, if you were a customer success associate at Amazon, working with some clients to get their Amazon-hosted stores up and running, and then you went and became a customer success associate at Shopify (ignoring for a moment the above concerning non-compete which would likely make this illegal), you couldn't then call that customer and be like "hey, I work at Shopify now, how about you come work with us instead of Amazon?".

Of course, your case may differ and you should read the contents of the contract carefully, and if you have any questions you should ask a lawyer, or you should get clarification from the company in particular about what you can/can't do. But at least in my experience, the definitions of the terms in those kinds of clauses tend to be very restrictive in favor of the employee.

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    This is a bad answer. "The way most of the terms I've seen have been written is that "competition" means that you are prohibited from doing the same job for a company that is in direct competition with the company you are working for, in the same department as you were working, with similar responsibilities as to what you were working on." Obviously, that's not the situation here, the OP specifically mentioned direct & indirect competitors. "Of course, your case may differ and you should read the contents of the contract carefully..." No, no. His case is definitely different. Aug 20 '21 at 19:50
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You haven't told us what type of job you're referring to. But that "direct/indirect competitors" wording is very suspicious.

In my own field, which is Android mobile software programming, having such a clause would be a deal-breaker for me (unless they were paying me a significant percentage of my regular salary to sit on my ass and do nothing during those 6 months).

If I were you, I would email them and ask them:

What did you mean when you said "direct/indirect competitors"? Can you provide a list of examples you're talking about.

If they say "Don't worry about it, we won't enforce that." Then, strike that clause off from the contract and ask them to initial the change. Don't ask them for permission. Simply do it and email them the new contract, asking them to initial the change.

Or if they give you a perfectly reasonable interpretation of that clause, then do the same thing. Insert the reasonable interpretation they gave you into the contract, email the contract back to them, and ask them that they initial the change you've just made. But again, don't tell them that you're going to modify the contract, just modify it, and then ask them to review and initial the change (before you sign it).

How normal are agreements like this when signing full time contracts?

Unfortunately, these kind of clauses are very common, even for minimum wage workers such as waiters or supermarket cashiers.

But does that really change anything? Some toxic workplaces are very common. That doesn't mean you should accept such unreasonable and overly broad clauses.

If I do want to switch jobs later on, how would I know if a company is considered a indirect / direct competitor?

You wouldn't. That's the entire point of this clause. It tries to give them power over you (whether it's legally enforceable or not).

It's like they expect you to ask them for permission before you apply to any company.

Is there a legal definition or is more of a question of opinion? How often do companies actually pursue legal action because of Non Compete clauses?

The rest of these questions are for an employment lawyer in your specific jurisdiction.

But again, even if the company doesn't sue you, does that really matter? At the very minimum, signing such an overly broad clause would give them the idea that they should be able to harass you and harass your new employer.

And even if they don't know where you're going, they may still find out through the grapevine, or when the new company calls to double-check your employment history.

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  • Have you ever had pushback on the just-change-it-and-initial-it tactic?
    – Pete W
    Aug 21 '21 at 0:07
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    @PeteW, Can you lose a job offer if you push back? Sure, I didn't mean to imply that this wasn't a possibility. And I know at least one person who had his job offer rescinded because he questioned the non-compete. In my case however, overly broad non-competes are not usually a problem for me because I am in California. And the only contracts I've personally modified were not strictly employment related. In either case, it's all part of the negotiation. If you see too many red flags with a potential employer, you have to be willing to walk away. Not all job offers are necessarily good offers. Aug 21 '21 at 1:27
  • Thanks for the reply. I was less concerned with losing the job offer for daring to ask (which would be a win-win outcome, given what it would indicate about the employer's attitudes). I was asking more out of curiosity about this tactic vs a more lengthy, but polite, written explanation, justifying the request.
    – Pete W
    Aug 21 '21 at 18:42
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    @PeteW, A lengthier explanation, justifying your request, may still work, but it's much less likely to work. It's just too easy for them to say "no" to it, or to imply that you're holding up the process, or to say that the decision maker is on vacation, or to lie to you and say that they'll have the new contract ready on your first day, etc. Besides, this request doesn't need an explanation. They know damn well what they were trying to do with this clause. Do not explain and do not justify yourself. If you're not assertive with your request, they're going to assume you're going to fold. Aug 22 '21 at 0:17

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