Employment contract - non competition ?

[busa_rush]

My employer wants me to sign a new contract which states that I won't work for a competitor (either competitor or one of their partners) or one of our suppliers or any other business contact I've had during this employment, for 6 months after I leave or am dismissed.

Is this still legal ? IIRC this was outlawed some time ago, maybe I'm not remembering it correctly ?

It also says that for 6 months after I leave I can't make use of any supplier or custonmer of my employer.

It aslo says that I irrovocably give the company power of attourney in all IP matters, regardless of wheather the IP relates to the business or not.

It also states that any company property in my posession (phone, laptop etc) if lost or stolen, the company will deduct the value from my salary.

Does this sould reasonable ? Sounds bl**dy awefull to me. Any comments ? I work in IT so my knowledge isn't unique, there are 100's of people who could do my job, it's not as if I'm an agent or an underwriter who could easily pull customers with him if he chose to.

Thanks

[rushdriver]

Tell them to review the terms, the stolen laptop etc, that's very off side in my opinion.

As for not working for competitors etc I *think* that it's illegal to do that, at the end of the day they can't stop you getting a better job.

John

>> Edited by rushdriver on Sunday 19th December 14:08

[GreenV8S]

Sounds completely bizarre. If you agree to those terms then it could cut your career options down considerably, leave you with significant liabilities for the company property, and give the company control over your intellectual property. Is the company offering any compensation for all of this? If it is just a matter of letting you keep your job then you have to ask whether you are willing to give your employer this much control over your career. From what you say, I certainly wouldn't.

[loaf]

If there's a union in your place, get them on the case. If not shoot down to the local CAB and get them to have a squint.

Sounds well dodgy to me.

[parrot of doom]

Sounds like bollocks to me. If they want to stop you working for a competitor 6 months from leaving, then insist they must pay you for those 6 months at a full rate.

The bit about liability for damage/theft to company property is more vague. Personally, I would insist that any property that was in my custody was to be insured by the company.

The best thing to do is either contact your union, or return the contact signed, but with additions/modifications outlined as per your requirements.

[voyds9]

The employer seems to be protecting his business, after all you could walk out with all his contacts and set up business down the road.
We have recently had someone say they were leaving that night not to return and ended up working 50 yards down the road at a rival business.
We have also had someone whilst working for us on our premises using our telephone to run a rival business.
Another member of staff has had his laptop stolen from his car, even though company policy states it should remain with him at all times.
All the above thought they were in the right and their contract really didn't apply.

[2 Smokin Barrels]

The pendulum has swung back in the ability to enforce non competition clauses. I'd spend the money & get it properly checked by an expert.

[JonRB]

Non-competition and non-solicitation is very common in the kind of contracts I work under as a freelancer.
They're generally unenforceable anyway, so aren't too much of a big deal.

As for the laptop / phone etc thing, I would make it clear to them that if they want you to sign that then you will not be accepting any such company equipment named in the contract, even if it prevents you from doing your job properly.

What really gets my goat (on your behalf) is that if you lost a company laptop they'd recover the money from our salary (if you signed this contract) but would undoubtedly claim for it under their company insurance policy also, and get double the price of it back.

>> Edited by JonRB on Sunday 19th December 18:15

[LongQ]

This sort of contract has been around for a while, including the IP bit though I doubt they could find a way to apply it (if they know what it is).

I woould objeyc to the terms applying even if dismissed or made redundant/laid off etc. That might give power over you to people other than your employer (in the event of the business failing) and could not be right.

I think I would also point out tactfully that such an approach does not really lead to mutually trusting relationships between employer and employee.

But then fewer and fewer people seem to care about that these days.

[autismuk]

busa_rush said:

My employer wants me to sign a new contract which states that I won't work for a competitor (either competitor or one of their partners) or one of our suppliers or any other business contact I've had during this employment, for 6 months after I leave or am dismissed. Is this still legal ? IIRC this was outlawed some time ago, maybe I'm not remembering it correctly ? It also says that for 6 months after I leave I can't make use of any supplier or custonmer of my employer. It aslo says that I irrovocably give the company power of attourney in all IP matters, regardless of wheather the IP relates to the business or not. It also states that any company property in my posession (phone, laptop etc) if lost or stolen, the company will deduct the value from my salary. Does this sould reasonable ? Sounds bl**dy awefull to me. Any comments ? I work in IT so my knowledge isn't unique, there are 100's of people who could do my job, it's not as if I'm an agent or an underwriter who could easily pull customers with him if he chose to. Thanks

Maybe it is legal to limit working with other companies ; customers. It depends what you do, as you imply. If you could damage the company by so doing (e.g. trade secrets or customers) is not unreasonable.

The laptop ; no. That is what insurance is for. I doubt even if you sign it the unauthorised deductions are legal.

[busa_rush]

Thanks for the replies, I don't think I'll be signing this contract, my existing contract doesn't have any of these silly clauses in it amd financially there's no difference, unless I loose my laptop !

I like the point about it not promoting a trusting reelationship, that's how it feels, completely one sided and the company dictating terms rather than working with us. Previous companies I've worked for felt as though we were one team, this company feels like the old fashioned "them and us" situation. It's only a small company and no union.

[xxxxxxrich]

autismuk said:

I doubt even if you sign it the unauthorised deductions are legal.

I think the truck act applies to that. AFAIK they need your written permission to deduct money from your pay and a clause in the contract isn't good enough.
The truck act (if that's spelt right) was set up because of something to do with dock workers being forced to pay for union fees out of there wages.

[r5bmb]

Didn't someone manage to get the non competition rule over turned, because of the job they had was very unique, and by saying the employee couldn't work in competition was basically denying them a living?

You can see why it would annoy some companies though, you imagine if you spent a couple of months training someone up to do a job, and then they leave and go to work for your competitor you would be a bit annoyed.

Andrew

[LongQ]

busa_rush said:

Previous companies I've worked for felt as though we were one team, this company feels like the old fashioned "them and us" situation. It's only a small company and no union.

There seems to have been a tendency recently for small companies to 'think big' and take on the theoretical concepts of larger companies without actually being in a position offer anything in return - reputation in the market, training budgets, redundancy terms should that arise, something recognisable to put on a cv, all sorts of things.

Worse if they find a guru who arrives as some sort of consultant, expert in IP/Brands or has been shoved out of a larger company and wants to up a small one one his/her way to retirement or oblivion.

Any changes in senior personel recently? New HR managers or legal people would be favourite.

[busa_rush]

LongQ said:

Any changes in senior personel recently? New HR managers or legal people would be favourite.

Company is being readied for sale (sooner than we thought perhaps ?), one clause in the new contract specifically allows all employee details, inc salary etc, to be provided to a prospective purchaser. I guess this is to circumvent the data protection act.

There's nobody new in the business but they have been seeing their solicitor a lot, he created some new policies for Interet access, e-mail etc that are next to useless, they were obviously taken from templates from the late 90's, no good today, they don't even recofnise the existance of hand held devices.

I appreciate they want to protect their business but as somebody else said, being a small company they won't/can't offer the attractive terms larger firms would.

Incidentally, what's the statutory notice period ? They have introduced this too for anybody with less than 4 years service.

[2 Smokin Barrels]

One week per year's service.

[Pigeon]

xxxxxxrich said:

The truck act (if that's spelt right) was set up because of something to do with dock workers being forced to pay for union fees out of there wages.

It was set up to prevent railway navvies being exploited by the contractors who employed them. Basically instead of being paid in cash they were often paid in "tommy tickets" valid at the "tommy shop" or "truck shop", operated by the contractor, which sold them rotten food at exorbitant prices. The system also involved an element of IOUs deducted from wages paid in arrears to keep the navvies permanently in debt and remove any chance of breaking out of the circle.

I have a feeling that it gives you the legal right to insist that your wages are paid in cash.

[woodlands]

I have seen many similar contracts, for predominantly from American companies.
Much of the stuff you allude to is unenforceable, and completely unreasonable,to include the IP and laptop/phone things.
They should have insurance for laptop/phone.

My suggestions would be to at least push back hard, and in the event that they refuse to compromise, walk away from the company, as they are showing their true colours (or colors) whichever is applicable.
I am just surprised that they haven't insisted that you also have a clause in the contract which insists that you opt out of the Working Time Directive as well.

[busa_rush]

There is an opt out of the working time directive, it's part of the contract ! That doesn't bother me really as I've always worked additional hours as required and got them back later but the contract states that the employee must work all reasonable times and there's no guarantee that we'll get paid for them or get the hours back.

[busa_rush]

Thanks Tonker, that's pretty much what I thought but the IP clauses are badly written and if you go simply by the exact wording, it includes any IP you have or create either inside work or not, it doesn't specifically include work.