Should I sign a non-compete as I'm leaving a company?

Question

I've recently accepted a position at another company, and given my notice to my current employer. As part of my offboarding process, my current employer has asked me to sign a non-compete agreement (which I did not do when I started at the position), including a non-recruitment clause.

From my perspective, this doesn't seem like something I want to do (especially considering that I have several coworkers that I think would be really happy at my new company). My question is this: is there some reason that I'm not seeing that I should sign this document, or is it reasonable to politely decline my employer's request?

Answer 1

As Wesley and Vietnhi said in the comments, I'll reiterate: Hell no

Given that you didn't specify if there's a dollar amount tied to it, I'll assume there isn't.

What you stand to gain:

1) Some good will from the company (which you're currently leaving). This could be useful in some future discussions with the company if, say, you decide to return. Aside from that, it's mostly useless at this point.

What you stand to lose:

1) It sounds like you don't know what's in this non-compete completely. If that's the case, how do you know they aren't trying to get you to sign this non-compete which would cover the company you're moving to? Be careful with documents like these - they're often broad and could come back to hurt you very easily

2) If the new company ends up not working out and you quit after, say, 3 months that non-compete could severely limit any other potential jobs that you could find

Answer 2

Don't sign ANYTHING when leaving the company other than the paper that you're leaving. And maybe the paper where you state that you've returned all the equipment that belongs to the company.

There is nothing you'll gain from that and a lot you can lose:

• Your relationship with the company is already on the bad side since you're leaving
• New liability is not something you need
• Why limit your choices? Even potentially.
• You don't get anything from signing the document but your employee does. Is that fair?

All the documents are signed BEFORE you start working for a company, so easily dismiss all NDA's and other documents that come after you've decided to quit.

You can find yourself in a lot of trouble by signing some documents that prevent you from future employment of starting your own business.
You should definitely decline the request.

Answer 3

Since it is too late for a non-compete since you have taken the new postion legally, I suspect it is the non-recruitment clause they are most concerned with.

If you intend to recuit co-workers (and it sounds as if you do), you most definitely don't want to sign this. In fact, I would probably protect myself by sending them a certified letter stating that your refusal to sign this after having given notice. But in any event if you want to recruit when they don't want you to, then it is best to consult a lawyer or bring the document to the new company and consult thier lawyer as to what actions you should take.

Answer 4

It's more than reasonable to deny your employer's request, it's just common sense.

Non-compete agreements have less to do with you than with your employer and their competitors - they don't want you working for their competitors. In fact, the only reason why non-compete agreements do not last forever is because the law (at least in Canada) limits the length of those stipulations.

Considering laws exist to protect employees from excessive non-compete agreements, it's a safe conclusion to assume they're bad for you.

Having been personally stopped by non-compete agreements in the past, there is usually nothing to gain as an employee by being restricted by one of these.

Odds are your employer will not be willing to compensate you a fair amount to sign this, as I would estimate that value as at least 10% of the annual salary of the employee, you should just simply not sign it.

Source: I've signed these and they are a headache

Answer 5

You should check in your contract that signing a non-compete after resignation isn't mentioned, and if you still aren't sure consult a lawyer (it is probably worth your time and money to do this even if you are sure). Assuming it isn't, I agree with Wesley - it's their fault that they didn't have you agree to sign such a document at signing, and now they need to compensate you in exchange for your agreement to sign a document that's disadvantageous to you, either monetarily or otherwise, same as if they came to you with no prior employment and asked you to sign it.