madras650 Posted 30 Jul 2011 , 1:19pm
post #1 of

I have taught myself everything I know.

I just moved to a new town, and found a job at a custom cake shoppe. Please see my work in my photos

I have worked there about 2 months with NO MENTION of this contract until this past week. Never mentioned at interview.

I am very part time, I make $200 a week

ALL of a sudden the owners want all employees to sign a non compete contract.

If FIRED, or if I quit, I cannot work at any other BAKERY within 90 miles for a year from date of termination.

I cannot start my own business, 90 miles, one year

I cannot own interest in any other business, teach, consult, advise, assist in any business that is SIMILAR to my current employer.

I UNDERSTAND they are trying to protect their business. I GET WHY they are doing it.

Would you in your right mind sign such a contract? I Just moved to this town, I am a single mom trying to provide for my child. If something better should land in my lap, I would be silly not to pursue other options.

I think they are rewriting the contract to say within 30 miles instead of 90. That makes no difference to me. 30 miles may as well be 90 miles.

What are your thoughts?

46 replies
NerdyGirl Posted 30 Jul 2011 , 1:39pm
post #2 of

Nope. Wouldn't sign it.

If you move and it's still within that radius, you can't work for a year! Some will mention doing other things, but spending that much time and energy working on your craft? Nope.

They want to protect themselves. You have to protect yourself too. Maybe you can discuss it with them and negotiate something that'll work best for both of you.

dinascakes Posted 30 Jul 2011 , 1:47pm
post #3 of

If this is your livelihood, the only way to support your family, I wouldn't sign it. It's ridiculous because if this is what you do and you are let go or have a better opportunity, you should have the choice to take it. As I do understand what they are doing, I don't agree with it. It's like saying, if you're a paralegal working for a law firm and get fired or are offered better pay somewhere else, you can't find another job at another law firm because of this contract. That's crazy! It's what you went to school for. They are cutting off their competition and YOUR opportunities at something better. Maybe it should be a contract that says something like you cannot disclose any bakery secrets or recipes of theirs, something like that, that I could understand. Good luck to you!

Crazboutcakes Posted 30 Jul 2011 , 1:49pm
post #4 of

Absolutly not! I understand that the company wants to protect it's self but really. I am sure that the bakery has nothing more that they can teach you that you haven't already heard or can youtube to learn. Me persoanlly wouldn't even commit to 5 miles out side of 30 or 90. Hard to give you a what should you do thing, being a single mom but I would much more perfer to see about other ways of making two hundred bucks a week, one cake would pay your salary for the week. Tough call on your part but for me it would be a NO! Best of luck.

Dayti Posted 30 Jul 2011 , 1:53pm
post #5 of

I recall reading on here a few times about cases where a non-compete contract may be illegal in some US states. I'm not much help since I can't remember what threads they were (though usually it was the other way round - bakeries asking opinions on the forum about making employees sign them). But it might be worth you doing some kind of google search or a search on here to see what was said.

Personally, I wouldn't sign it but I would agree only to not use their recipes for my own benefit. Not the techniques though...unless they really have invented something super new and never seen.

leah_s Posted 30 Jul 2011 , 2:00pm
post #6 of

Nope. That non-compete would likely be illegal in that it precludes you from making a living in ANY related field. But you'd have to get a lawyer to find out.

Bonnell Posted 30 Jul 2011 , 2:33pm
post #7 of

That's just crazy! If that is your chosen craft how are you supposed to provide for your family if you no longer work for them. Is that even legal? They are trying to deprive you of the ability to earn a living. My full-time job is as an RN. What if my hospital tried to tell all of their RN's (LVN, Respiratory Therapists, etc.) that if we left their employ we could not work anywhere else as an RN if it is within X number of miles from that hospital?! Doesn't sound legal to me and if it is maybe it shouldn't be.

matthewkyrankelly Posted 30 Jul 2011 , 2:33pm
post #8 of

That would make sense if you were a principal in the business,you worked full-time, benefits, 401-k, profit-sharing.

Part-time with no financial interest in the company - crazy. You'd be better off to leave if it comes to it.

jason_kraft Posted 30 Jul 2011 , 2:40pm
post #9 of

If I were you, I would request removal of the noncompete clause and sign the contract. (1 year not working at a competing bakery or owning a competing business seems reasonable and would likely be enforceable in OH.) If they balk at that, you could suggest a clause that bars you from using their proprietary information in order to protect their recipes, customer list, etc.

luddroth Posted 30 Jul 2011 , 2:41pm

It sounds to me like the agreement may overreaching -- it would be in many states. If you don't know a local lawyer, try Legal Aid. The form of agreement they are using may not be legal in your state. If it is, then you will have to tell your employer what you've told us -- you don't have a present intention to compete, but you are the sole support of your family and cannot risk being compelled to move out of town if they decide to lay you off. Then it is a negotiation: you might agree not to voluntarily quit to set up your own business within some geographic area or time period, but not agree to anything more than that. Will they fire you if you don't sign? You should find a local lawyer or someone at Legal Aid who can tell you whether or not they can. If they can, then they'll have to make that decision. Best of luck to you.

luddroth Posted 30 Jul 2011 , 2:53pm

I just googled "non-compete agreements in Ohio" and found info on a site called myemploymentlawyer.com that is very helpful. They list factors that a court will consider in deciding whether to uphold an agreement. Several of those factors are in your favor and worth discussing with your employer. (For example, the employer cannot prevent you from using skills you had before commencing your employment.) They also give contact information for consultation with an employment lawyer -- it doesn't say whether the initial consultation is free, but you could ask.

LKing12 Posted 30 Jul 2011 , 2:58pm

The part about being "fired" puts a whole new spin on this. I can see the problem if you quit the job to go somewhere else. But if you are fired! What if you sign Monday and they FIRE you on Tuesday.... NO WAY!!!

Occther Posted 30 Jul 2011 , 3:33pm

Non-compete clauses are standard in my industry - I am a therapist. It just prevents us from working at the same place or any of their contracts for one year. However, I do believe that Ohio is what is called a "right to work" state which means there are lots of restrictions on non-complete contracts. You need to consult an attorney or legal aid for more details. I don't think you should sign it - especially if you are in a rural area where employment opportunities are limited.

jason_kraft Posted 30 Jul 2011 , 3:46pm

I missed the part about OP already being employed...I believe the employer is required to offer compensation in exchange for adding the noncompete to the employment contract. If no compensation is offered, the noncompete should be unenforceable.

Of course if you do sign the new contract, quit, and work for a competitor (or start your own business) you may have to pay to defend yourself against a lawsuit, even if you win. I definitely recommend a consult with a local labor attorney.

luddroth Posted 30 Jul 2011 , 7:16pm

Jason_kraft -- the website I referred to earlier cites Ohio case law on that point: the consideration for the non-compete is continued employment. Ok in Ohio.

btrsktch Posted 30 Jul 2011 , 7:19pm

A non-compete agreement is a *must* for me at my business. If you don't sign it, you don't work here. Period.

HOWEVER... I can tell you for certain that the part about not working for another bakery for a year is non-enforceable. They cannot stop you from earning a living in your profession. The most they can enforce is stopping you from OWNING or being involved in any part of OWNERSHIP of another business.

cheatize Posted 30 Jul 2011 , 11:32pm

You are in Ohio. We have a cottage law. You could make $200 on one wedding made from your home. That income would supplement your bakery job income. That income could mean your child can actually get sick and see a doctor.

No way, no how. I would not sign it.

jason_kraft Posted 30 Jul 2011 , 11:41pm
Quote:
Originally Posted by cheatize

You are in Ohio. We have a cottage law. You could make $200 on one wedding made from your home. That income would supplement your bakery job income. That income could mean your child can actually get sick and see a doctor.



Are you talking about running a home-based bakery at the same time you're working for a competitor? If so I would be very wary of doing this, as that would definitely be cause for dismissal.

cheatize Posted 31 Jul 2011 , 3:05am

Without a non-compete, as long as she isn't taking the business' customers, why would it be cause for dismissal? Not that it really matters, as Ohio is an at will employment state.

foxymomma521 Posted 31 Jul 2011 , 3:34am

I haven't read this thread yet, but my family is currently going thru very hard times because of the noncompete my husband signed. We still have 11 more months, and it's gonna be tough. I wouldn't sign one, and if I had to, I would negotiate the terms in it.

jason_kraft Posted 31 Jul 2011 , 4:04am
Quote:
Originally Posted by cheatize

Without a non-compete, as long as she isn't taking the business' customers, why would it be cause for dismissal? Not that it really matters, as Ohio is an at will employment state.



If I was the employer and I was informed by an employee that they would be starting a competing side business ahead of time, the two might be able to coexist as long as the target markets were different enough. But if I found out that an employee was running a competing business behind my back, the burden of proof would be on them to convince me that they had not used any of my proprietary information or leveraged my customers, and that would be a pretty difficult thing to prove.

Unless you have your choice of several available employment opportunities in your area, competing against your employer while you are still working for them is very risky. This is especially a problem when employees have access to trade secret IP (such as recipes and business processes), since once you've seen this IP it can take some effort to show that your new company's IP is not infringing those trade secrets in the event of a lawsuit.

enchantedcreations Posted 31 Jul 2011 , 4:16am

You have to be really careful. I'd speak to an atty. I'm in Florida and it's an at will state as well. My husband signed a non-compete; it was required (he works for a fort. 500 co) He was told two months ago his dept. his closing. He will either be offered a job within the co. or given his walking papers. If he gets his walking papers, he cannot work for the "other guy" for one year. The other guys have already offered him a job, but they won't hold it and he's 55. They think they can get around the non-compete. His boss told him, we would get sued, not the other company. Better think about it.

CWR41 Posted 31 Jul 2011 , 4:23am
Quote:
Originally Posted by cheatize

Without a non-compete, as long as she isn't taking the business' customers, why would it be cause for dismissal? Not that it really matters, as Ohio is an at will employment state.




It's considered as moonlighting... a conflict of interest to many employers.

indydebi Posted 31 Jul 2011 , 5:29am

I have been told that non-competes are not being held up by the courts in many MANY cases for the reasons cited above: Preventing a person from earning a living in their field.

I was downsized out of a job and was required to sign a non-compete THAT DAY or I wouldn't get my severance pay. Hubby said, "Sign it. If you find a job in the industry, let 'em spend the money and sue us. In the meantime, you'll be working and feeding your kids." I am not offering this as advice .... just sharing how we handled our situation.

Kaybaby Posted 31 Jul 2011 , 6:03am
Quote:
Originally Posted by indydebi

I have been told that non-competes are not being held up by the courts in many MANY cases for the reasons cited above: Preventing a person from earning a living in their field.

I was downsized out of a job and was required to sign a non-compete THAT DAY or I wouldn't get my severance pay. Hubby said, "Sign it. If you find a job in the industry, let 'em spend the money and sue us. In the meantime, you'll be working and feeding your kids." I am not offering this as advice .... just sharing how we handled our situation.




Doesn't it work both ways? If they spend the money to sue you, don't you have to spend money to defend yourself?

Vonda

enchantedcreations Posted 31 Jul 2011 , 4:25pm
Quote:
Originally Posted by indydebi

I have been told that non-competes are not being held up by the courts in many MANY cases for the reasons cited above: Preventing a person from earning a living in their field.

I was downsized out of a job and was required to sign a non-compete THAT DAY or I wouldn't get my severance pay. Hubby said, "Sign it. If you find a job in the industry, let 'em spend the money and sue us. In the meantime, you'll be working and feeding your kids." I am not offering this as advice .... just sharing how we handled our situation.




This is a valid point. However, if you're offered a severance package wouldn't that be the companies arguement? You wouldn't necessarily have to work for one year, you were compensated by them and included in that signed agreement was the non-compete for one year. They give you your annual salary and you don't go to the other company. They're banking on the fact that after one year, you're no longer needed or possibly already replaced.

jason_kraft Posted 31 Jul 2011 , 4:40pm

A severance package is meant to tide you over until you can find another job, not to give you a year-long vacation from work. If you abide by a year-long noncompete it would be very difficult to search for a new position during that year unless you happened to find a company that would be OK hiring you but delaying your starting date until your noncompete expires.

enchantedcreations Posted 31 Jul 2011 , 5:25pm
Quote:
Originally Posted by jason_kraft

A severance package is meant to tide you over until you can find another job, not to give you a year-long vacation from work. If you abide by a year-long noncompete it would be very difficult to search for a new position during that year unless you happened to find a company that would be OK hiring you but delaying your starting date until your noncompete expires.




Jason, I wasn't implying a year-long vacation. But you have to look at all angles. If you take the severance package AND new employment, you're going to get hit big time was tax issues. In our situation, it will throw us into a whole new tax bracket. One we cannot afford. If, and that's a big if, my husband takes a new position with the leading competitor, we would have to move to avoid the non-compete. Another issue. And you're right about looking for a new job and the delay thing. It's a big issue. This was just something I was trying to point out to the OP. She needs to really think long and hard about signing something like this. It's not black and white. It can really impact her down the road.

jason_kraft Posted 31 Jul 2011 , 5:35pm
Quote:
Originally Posted by enchantedcreations

In our situation, it will throw us into a whole new tax bracket. One we cannot afford.



That's not the way tax brackets work. If you make more than the threshold for a tax bracket, only the income above that threshold is taxed at a higher rate. All the income below that threshold is still taxed at the rate for the lower bracket. For example, if you are married and make $200K/year, the first $17K of your income is still taxed at only 10%. Only the top $60K is taxed at the highest rate (28%).

Quote:
Quote:

If, and that's a big if, my husband takes a new position with the leading competitor, we would have to move to avoid the non-compete.



I think IndyDebi's point is that it's worth taking the gamble, since the legal costs/settlements involved in defending yourself against a potential lawsuit are probably less than the amount of the severance package. If you give up the severance package to avoid noncompete issues, you are taking a guranteed loss in the amount of the severance to avoid a potential expense down the road.

scp1127 Posted 1 Aug 2011 , 6:22am

I'm not going to repeat my story, but I won a lawsuit for over $100,000 against an employer who had me sign a non-compete agreement that was not legal. The charge was, "interfering with my right to work".

As Jason pointed out, you can only ask an employment attorney. My case had two legal teams working on it (both sides) and it took them awhile to sort it out.

Quote by @%username% on %date%

%body%