Non-compete clauses are the business version of a prenuptial agreement.

Director of the Department of Labour & Pensions, Mario Ebanks, has warned employees of the dangers of signing contracts carte blanche without proper consideration of all of the terms and conditions and where necessary negotiating them because the clauses could be enforced.

A local junior IT technician, who spoke with CNS on condition of anonymity, said he signed an employment contract a few years ago that contained a clause prohibiting him from working in a similar position for any “competing companies for a period of six months”. But at the time he never imagined it would force him to be unemployed when he is willing to work and had an offer on the table.

“The truth is, who signs a contract thinking that you will never be able to freely leave the job after resigning and immediately move into a new job? I am not a manager and I don’t have any information or trade secrets. I work directly with customers servicing their computers and that’s it. It never crossed my mind that this would happen,” he said. Once he resigned, he found he was not only out of a job but his new offer was withdrawn.

To read the whole article go to: https://caymannewsservice.com/contract-clause-spells-trouble-for-career-progress/

Are they fair?

Employers think so.

Dr. Randall S. Hansen writing on the subject on the Quintessential Careers website says:
“Employers use non-compete clauses to protect sensitive processes, technologies, and other trade secrets and information. The more competitive a field, the more likely employers will ask prospective employees to sign non-compete agreements. These employers do not want key employees to turn around and work for their competitors — or to become consultants or freelancers either.”

However, these clauses are often unreasonably restrictive and are not negotiated when a position is discussed and ultimately accepted.

The employee accepts the offer without noticing the non-compete clause, informs his/her current employer of their decision to leave, and the clause is brought to light. Even worse is the scenario where the employee is terminated by the employer and is prevented from working based on a non-compete clause.

If that happens I am sure the Labour Office or Work permit Board might intervene.

Traditionally, courts in the USA disfavored non-compete clauses because they were viewed as preventing an individual from earning a living by using his craft. More recently, courts enforce these clauses where the restraints are reasonable and allow an individual to practice his craft in some respect.

However, any employer who pushes these non-compete clauses are creating a self-selection and a market for lemons: the people who unthinkingly sign a non-compete may feel they don’t have the skills to get another job or take off on their own. Every employer wants employees who are self motivated, who have confidence, and who have aspirations.

So why would an employer want to y put up artificial barriers that make it harder to attract great employees?

People want to develop their careers–maybe work for a company for a few years then become entrepreneurs.

Freedom creates more incentive for employees to connect, be visible, network, and develop themselves both within and outside the company–all of which benefits their employer.

Once again people do not look behind the picture in front of them.

I was surprised to learn that Silicon Valley tends not to use non-compete clauses. And they don’t implement them because “Empirical studies confirm the intuition that businesses that allow more movement, more job mobility, and more flow of information within a region gain from that intra-regional ethos of focusing on what’s next. And they gain from the cultural benefit of a workforce that is more open and attractive to employees.

“When you allow talent to be free it’s not only better for employees, it’s better for overall economic development.” SOURCE: Inc. – “The Case Against Non-Compete Agreements”.

So, as a job-seeker, if you get a great job offer — the perfect job, with a great company, and a strong compensation package — but with the caveat that you must sign a non-compete agreement, you’ll need to take some time to evaluate the pros and cons of signing it and working for that company.

You might need to take some legal advice.