Add Employee Matters Agreement Signatory with airSlate SignNow

Add Employee Matters Agreement signatory

the broadcast is now starting all attendees are in listen-only mode good afternoon everyone thank you for allowing us just to be a few minutes behind schedule we wanted to give everyone an opportunity to log on and join us today my name is Dresden friend I'm vice president of chapter development for ICC national today's webinar is titled employee poaching legal issues can your chapter prohibit poaching among members please note that we will be recording this session and it will be available to you on the IEC website under the training tab and continuing education you are joining the webinar either via your telephone line and AB dial been using the code provided or you are listening and using your computer speakers and voice over IP feature all attendees are muted for the duration of the call we encourage you to send in your questions by typing them on the dashboard on the right side of your screen if you don't see that like lit let us know by raising your hand listenings a presenter or the facilitator a message our presenter will be seeing your questions as we move along the presentation and strongly encourages your questions during the presentation so he can answer them right then and there so again really encouraging a lot of questions in today's webinar so I'd like to go ahead and introduce our speaker who's a very longtime friend of IEC Philip Russell from Ogletree Dickens Philip Russell is a practical labor and employment lawyer and represents businesses and a wide range of labor and employment law matters including workplace safety and health traditional labor relations unfair competition and trade secrets litigation employee litigation defense etc etc he does it all Philip represents clients and the construction stopping technology manufacturing banking and other industries he is also a nationally recognized weaker and offer on labor and employment law issues and I think he is the best person we can possibly have to present on this topic today so without further ado welcome Phillip and let's get started Wow Dressen thank you very much it was a very nice and friendly and friendly introduction so thank you to you and thanks to to all my IEC friends and hello everyone from across the country shoutout to the DC office or the headquarters up there for a each day national with Spencer and Tim and Jason Lisa and company for for putting on this IEC webinar series and bringing Dresden on board I think it's a fantastic way to get some good subsets of useful information and actionable items out to the members got to give a shout out to Reyna and my home chats are in the Florida West Coast so I hope folks from Tampa Bay or tuning in or exile across Florida these days are tuning and mr. awesomest and I do have a longtime career with the IEC and have a number of great many clients that are IEC members and chapters as well so I have certainly have been advising chapters on the issues like we will be discussing today as well as advising employers as stressin mentioned to my career and employment and labor lawyer for businesses I emphasize OSHA these days because unfortunately there have been a tremendous number of fatalities and other serious injuries that happen and my home state of Florida but you know as I mentioned I go around the country and represent employers whenever crisis strikes and and it had at least lately far too many ports and much experience in that area but across the board an employment lawyer for businesses I don't represent employees I don't represent unions my job is on the other side my job is to protect your business and I've got a career doing that I've got a passion for doing that because it comes from my childhood first job of bagging groceries in my family grocery store so I try to take a look at everybody as if they're the family grocery store from way back in the day and give it the same kind of passion and and frankly I just believe in business and that's why I spend so much time with ramaya you see friends I had the opportunity a few years ago to testify in front of Congress and large part thanks to you guys for supporting my career and I had an opportunity to testify about some of the changes in labor law back in and the first part of the decade about this whole micro Union issue and how it may impact members do get a chance to go to speak and and write some things from time to time and also something very exciting I just wanted to mention briefly and we're going to jump right in is that my firm over some deacons were really a global firm and we are a boutique even though we're large we're a boutique and then we only do labor and employment for business and we have an expanding relationship around the country because as much as I love the IEC I can't do it all and that's a good thing too because I want to reach out and did some of my colleagues helping the members and the chapters from around the country so we are in the process of working on making those introductions so if you don't if you don't already have an oval tree contact of closer than Florida and of course you can reach me anyway through technology and anytime but we will will work with you on that so that will be coming soon as well so the topic for today let's jump right in very controversial topic I have spoken about this in formally informally with a lot of folks when it comes to this very important issue which is how do I protect my business and that's generally how the question comes up is how can I protect my business part of how I want to protect my business this is the question how it comes from a member is that well if we should all be with our soul get along we should all play well and play good and sandbox play well together and not steal each other's assets not feel each other's customers not steal each other's employees and that's where it comes in and because we're all in this club together that we call the IEC part of good citizenship is to not do that with each other and of course that request then makes its way into some chapters and some chapters may be tense that I may have already said you know what we're okay with and we're going to well we'll approve that and we'll go ahead and have a chapter policy that says members cannot poach employees from other members so we're gonna look at this issue and I'm going to answer that question for you and then because I don't believe in lawyer you're saying no I think that lawyers need to help clients find a way to to achieve their end goal and if you're in the goal is to protect your business then I'm going to give you some ways to do that today that don't get you in deep deep trouble when it comes to the wall because we see consequences for violating the laws that we're going to speak about today are huge and I don't want anyone in the IEC facing this and I have seen other professional organizations to face this issue in addition to the IEC I represented I'm not going to name them name names but other industry groups and other professional groups that have gotten caught in this legal issue so it is very real and it does happen as far as dimension please do populate the question box as we go webinars are frankly a great way to get great information to a lot of folks on a geographically widespread basis they don't however lend themselves to I think what is my favorite way to speak which is a very interactive exchange with my audience so it's not my personal preferred method but I understand the value and I'm gonna do the best I can today but I want to ask you you help me out by jumping in and throwing some questions in that box as we go because it's not I'm forced to ask my own dumb questions and I'll do it if I have to but I'd appreciate some help from you guys so we're gonna talk about chapter policies and antitrust laws the way the title this presentation is set up I'm going to be speaking the chapters but I understand they're likely to be members on the phone and that's fine too because I'm going to give some direction there as well and the alternative approach here that can be done lawfully is going to be through the non-compete agreement world and I'll talk to you about what a what I call a business protection agreement and give you some guidance there so outcome for this webinar I don't believe in sitting around listening to things and saying oh that's interesting and helpful and you know maybe I've got some great knowledge today and in hey you know with all her knowledge is power well I actually don't believe that I don't believe in knowledge is power I think knowledge is potential power what I want you to do from today what I want you to do from every time I have an opportunity to do a webinar or do a session or training with you is I want you to do something I want there to be some action for you to do so I'm going to ask you I'm going to give you multiple choices today and to decide but I'm going to challenge you at the end of this program to pick one thing to do and one thing to do today and I'm also going to ask you and you'll see at the end I'm going to ask you to pick an accountability buddy to get it done because we all need that help from time to time just like professional golfers and tennis players need coaches and accountability sometimes we as professionals and the business world need the same thing so hopefully today you will be able to pick out in fact I'm confident you will be able to pick out at least one concrete specific and measurable thing to do based on the information you're gonna learn today all right so what is in fact what is employee poaching one member hiring another members employees very simple one number saying to the other hey I'm going to tell how are your employees but you know what actually there's another perspective and I would actually have a one more definition for this this word of poaching makes it sound negative makes it sound like you're violating you know FWC's rules on on hunting and bag limits or in my world I love to go spearfishing so I'm going over the daily limit on the number of fish I get so maybe I might be a poacher or maybe I'm you know spear fishing out of season and poaching so it makes it sound very nefarious but put it another way another perspective it is some bleak competition and that's where I think we've made the mistake and that's where I think this myth has sort of a has grown perhaps among my EC and practicing them among other industry associations because again we're not the only group that struggle with this issue there have been many many others across multiple industries and the feeling is that while the antitrust laws well that just mean that I cannot agree with my competitor to set prices to discuss you know competitive things like costs materials supplier details those are the kind of things that were used to seeing in the antitrust world that would violate the Sherman Antitrust Act from way back in the 19th century that law has been around forever but here's where folks where folks I think the myth has grown is that people don't understand that it's not just a matter of what happens on the side of capital on the side of revenue on the side of profit on the side of competition for customers but it is also in the comp in the world of competition for labor and when you understand that concept that's very simple concepts alone that hiring someone else is hiring another employee well that's part of the competitive world that is competition and to say that for one member to go to another or for one company to go to another and say I will I won't hire your employees if you don't hire mine it doesn't even have to know I'll go over in this in detail it doesn't even have to be a written agreement it could just be that gentlemen's agreement to use it an old-school sexist term it could be the bank deal handshakes whatever metaphor you want to use but the issue is can you do it and so of course the question for you chapters out there can your chapter prohibit employee posting among members the answer is no for those of you have better things to do you can actually stop right now get up and leave because I have just answered a big question for you can you do this the answer is no there is no way around most I don't think that any chapter needs to be involved in any of these kinds of agreements and I don't even think members should be involved in I'm going to go over that in detail as well but the answer the same question is very simple unlike many legal issues where there might be a what if or maybe or it depends this is one where I'm going to give you a flat-out note IEC chapters should not be involved in any kind of agreements or policies or codes of ethics or anything of that nature because you will expose the chapter and perhaps yourself to some liability well who cares about this let's start who are the enforcers who are the folks on the other side you're gonna have to worry about well let's start off first of all with these federal antitrust agencies that is the Department of Justice that is the Attorney General and they do have an Antitrust Division their sole purpose in life this group of lawyers is to look at it to look at issues like this is to look at and what they've been doing increasingly in the last five years in particular is not so much looking at corporate violations of antitrust laws on the competition side on the competition for capital a competition for customers they are have got increasing scrutiny on what I'm talking about which is antitrust behavior in reducing competition for labor reducing competition for talent and employees I'll talk about some of the hot news items in a moment but the attorneys general of the states have gotten involved California this is an area where they were in the lead sometimes we don't like it when California gets in the league they tend to get a little bit too far ahead of everyone else but in this regard they were definitely a lead when it comes to this issue and others followed suit individual employees you may have heard about the technology class actions that have come out of Silicon Valley resulting in hundreds of millions of dollars of problems for employers who engaged in these agreements who went to each other not even necessarily through an industry association in fact if I'm entirely clear how the agreements were reached but it was very clear from the results of hiring over the period in the last five years that there was something going on and in fact those companies entered into settlements that were frankly staggering in your competitors those folks who you know can get hurt by this but your employees the attorneys general United States and Department of Justice for the federal antitrust agencies those are the folks that are going to get worked up about it fine so what's the worst that can happen you know that's that's the thing about the law is that I don't make business decisions for you you make business decisions now I try to stand shoulder to shoulder with you as best I can and help you make that decision but my job in the decision-making process is to let you know what this could cost you if you choose not to not follow the advice or not to follow this new knowledge you have well this is the possibility civil liability I mentioned that the high-tech poaching class-action lawsuit settlement from 2014 64,000 class members an estimated 325 million dollar settlement that's confidential so I'm just going off a media reports I wasn't involved and I think my firm was involved in that so no backdoor information there but the but the information they just go typing if you Google employee poaching you'll find it in fact even from this year one of the headlines that came out with Disney settling an anti-poaching lawsuit for a hundred million dollars and that was involving a class-action filed by their animators and some of their other other employees where Disney are visual effects employers I think what they call them but they also enter instant agreement their criminal charges folks are going to these folks can be charged with with violations of federal and state law as well for this activity and the liability can be not only enterprise not only free business but it also could be individual liability now I don't know about you folks but I don't think there's any of this there's no agreement that I'm going to be talking about today that would make me feel compelled so compelled and I'm willing to risk going to jail and that is a reality it does happen so this is not just you know Chicken Little or the skies falling what about those gentleman agreements what apologies to the ladies this is an old-school reference of course but an illegal agreement can be oral it doesn't need to be on paper there the day of Dartmouth the Department of Justice recent cases involving eBay Lucasfilm and Adobe and involved any written agreements these were all sort of backdoor handshakes the Federal Trade Commission had cases against TV's corporation and the industry group the Council of Fashion Designers in which the members of that Industry Association had reached agreements in terms of the amount of pay that models would be receiving here's what the Department of Justice had to say and the FTC recently stood federal antitrust agencies in 2016 of last year in October they issued an antitrust guide for HR professionals I thought it'd be interesting to see what they had to say about these agreements and frankly it's written pretty clearly it's written for folks in the field to understand what the enforcement priority would be and here's exactly what they say you see it on the screen if the no poaching agreement is naked that means it is a separate form not reasonably necessary to larger legitimate collaboration and this was between universes this was actually QA from that guidance its conduct that the division will criminally investigate and may decide to prosecute institutions or individuals or both and there is the link if you'd like to follow it to repeat that guide further fleshed us out a little bit further what is an agreement well as I mentioned informal oral nani doesn't even have to be an agreement that's legally binding doesn't even have to have been something that was successful it could have been something that was never implemented this could have been a discussion over beer this could have been a discussion at a cocktail party this could have been a discussion and an IEC chapter meeting it will involve lots of different things so my advice to you folks is do not even talk about this sort of thing because the appearance of impropriety can be used against you and I don't want anyone getting in trouble for so we also can take a look at what are called concerted practices this is where the government or plaintiffs lawyers might say well I don't have that smoking gun I don't have the evidence of an email that says hey why don't we agree not to hire each other's employees or I don't have somebody wrote it down on a cocktail napkin even and signed it but when you take a look at circumstantial evidence parallel business activities in this area together sort of a plus factor as they call it in the enforcement guidance opportunities to conspire motive and then questionable documents essentially what happened to all the cases I've referenced already is they really didn't have a lot of smoking gun evidence what they primarily had were the results what was the impact and when you begin to see that Google and and and I'm just making up names of household names at this point so it's not going to the details in those cases but it's Google and apples stop hiring each other's particular kind of engineer well that's very easy to see that we'll wait a minute to hire systems engineers and you hired thousands of systems engineers but in the last five years you've hired none of those from Apple there must be something going on and that's what would cause law enforcement or plaintiffs lawyers to dig further and the way that this comes up by the way you may wonder well how would they find out how would the Department of Justice the FTC kind of plaintiffs lawyers find out anything somebody is going to complain because somebody some employee of a member is may want to move to the competitor may want to go get a job somewhere else because he believes it moving from a BC contractor to XYZ contractor is good for his or her career but they can't do it because XYZ won't even give him or her a look because of this handshake or handshake deal with ABC and so that's how they find out then they go down the street to in my town they would go to Morgan and Morgan plaintiff law firm that love these employment cases and then Morgan o Morgan might deploy substantial resources to look further and now you go from an individual employee then you go to a class-action lawsuit that could grow into what we spoken about before and if the chapter is involved you will get snared in and so you want to be mindful that they're part of it one of the most aggressive enforcement frankly the most aggressive enforcement mechanism we have is playing for it why because they have a financial incentive unlike the government they're doing it for the public good and we appreciate that and I understand that but plaintiffs lawyers are motivated by the ability to make a substantial amount of money go back earlier to those settlements one hundred million dollars in Disney three hundred twenty-five Millions for the other technology companies that's about a third of that that's going to go to lawyers fees each of those individual employees may not get a huge payout and they get a few thousand dollars here in there the lead plaintiff will certainly get more than the rest of the offense and you've all seen these class-action notices in the mail when someone makes a mistake credit card company a cable company what have you well that's the same way this would occur in so the same way it happened with the technology companies well you say so if I'm not too worried about a class action I'm only got about 25 employees well a class doesn't have to be thousands or hundreds it could be anything more than two to be a class so you could have your small employer could hit could get hit by a lawsuit that involves employees and it would not just be the employees that you hired it would be the ones you did not hire so it could be a matter of both not hiring your competitors employees but it also could be a matter of the wages being suppressed because of this activity what does the Fed say where they say what what is the definition of an tine push and well the same thing from that guide they say that this is an agreement among competing employers to limit or fix the terms of employment but it doesn't go to just job opportunities it also goes to things like wages salaries or benefits or other terms and conditions of employment so a question and I took this actually from the guide that I fashioned it around passionate for this particular circumstance when attending chapter meters or events what soon members do to avoid filing in a wall well there's two things area two areas should not enter into agreements about employee compensation or other terms of employment that's benefits you shouldn't even discuss those things at the bottom so you have agreements and you have discussions and there are some Reds life if you look at that guide you'll also find that the federal antitrust agencies have developed an antitrust red flag list for employment practices it's about a page long but I condensed it for you as best I could I think it's very simple Express agreements with a competitor about not hiring that's the anti-poaching or we won't hire yours if you don't hire ours employees salary benefits anything of that nature in discussing them either at a specific level or within a range now question might come up about whether or not it's okay to do surveys and the answer that is and the guidance from the government is surveys are okay as long as they are done and this is the key they need to be done by a third party they need to be done by an industry association so it is possible for our chapters to do a lawful legally compliant serve but it has to be done in a way where the data is protected and not identified with any particular employer so there's a methodology to go about doing that and there's guidance from the government that's available they actually specifically gave guidance out to the healthcare professional associations because surveys are so popular there and then also it's not just Express agreements but as I said before implied or suggested agreements about these things and then exchanges of information this is again what we have to be very careful because it may not be an express agreement that gets us in trouble but it could be that that exchange of information that might cause someone else to act in such a way as to be anti-competitive in the labor market so we don't want to be exchanging companies specific information about pay we don't want to discuss those either directly with with other employers over at an ITC meeting you don't want to have social events or non-professional settings all those you know in documents that contain other company's internal data you want to be careful about receipt of those so there's your answer as to the question of what should chapters do the answer is stay out of it don't get involved in this I do believe you should update your chapter antitrust policy and statement I've seen several of them and they are fantastic when it comes to the competition sign but they need to have you need to add in some bullet points that you can take from this from this webinar today and put them into your antitrust policy and statement it really should be the policy of the chapter that members cannot enter into these kinds of agreements and the chapter is expressly discouraging anyone from entering to these kinds of gradients I think that is prudence and I think will give us a better protection from a chapter perspective if members so choose to go down that pathway you need to train your chapter staff on the updated policy and those red flags we just discussed so that they can help monitor and be mindful of those things and then perhaps do some training for members because I don't know if I know that there are some members only on call today which is fantastic but you may want to consider some way to educate them on those and then also I'm going to talk about now that I've said no because again I don't like to just say no I like to help solve a problem let's talk about ways to do that because the next thing you can do from chapter perspective is to make sure your members and get that's got an appropriate legal education about how to protect their legitimate business interests by using these things called restrictive covenant agreements now understand these agreements are with their own employees this is not an agreement company to company or member to chapter and then chapter remember it's member employer with their own employees traditionally we call those things non-compete agreements I've never liked that term in part because not all agreements I draft or clients actually have a non-compete provision a restrictive covenant they have a non-solicitation of non-disclosure my preferred name and I've used this and important in the court and frankly they're much they're much better received by the judge and the court as a whole whenever I go in and say judge I'm here to enforce our business protection agreements and so that's what I have now where do these things come from where does this non-compete or business protection agreement and by the way folks if you don't mind I'm going to use my turn this is protection I think your your vernacular your language is non-compete that's fine but when I say business protection I want you to hear non-compete it is an antitrust exception and I'm going to use Florida Statute it's just a an example in the state of Florida most states like Florida have their own antitrust laws that mirror the federal Sherman Antitrust Act and it says of course very simply thou shalt enter into any agreement that restrains trade and again trade on both the competition for customers and competition for labor but some states like Florida in fact I think almost all states like Florida have passed statutes that say well an exception to that rule is that you can enter into a restrictive covenant agreement or a non-compete agreement again my turn business protection agreement as long as it meets certain returns in this statute then you're fine and you can enforce that agreement now some other areas that come into play here and both I talk about the elements of a business protection agreement so that it complies with along is you also have some common law issues a common law is law that's developed over time that wasn't written by a legislature but it is something that is developed we sort of took this tradition from old Whelan and so this is where our torts come from you know there is no statute that says thou shalt not run into your neighbor with your car that comes from negligence and that's where your personal injury claims come from well in that world we have usually typically you're going to see a duty of loyalty some states may have it written in the statute but many just have it as a common law violation and what it says is that you have a duty of loyalty to your employer now in Florida we don't limit that to just officers of the company it goes all the way down for line-level employees and typically it means that you have a duty not to compete against your employer while working for him or her and you have a duty not to try and solicit away other employees while still working for your employer otherwise you subject yourself to civil liability there's also a claim called intentional interference with a contractual relationship and we see this commonly in fact I've already had two conference calls today in potential cases involving restrictive covenants not my business production areas of someone something that someone else drafted where my client or potential client in one case this morning knows about an agreement that a new employee had with his former employer hire the employee anyway and that is now facing the lawsuit where one of the claims was against the new employer saying hey you knew about this non-compete agreement you hired the person anyway you breached this contract you're going to be subject liable as well a new area of law believe it or not folks but there was actually a bipartisan moment in the last year and a half where the Democrats and Republicans came together and and I know I can't believe I'm shocked them even saying they didn't and they passed the federal defense of Trade Secrets Act that's President Obama signed into law which actually provides a more uniform method of businesses protecting their trade secrets it got very little public attention but in the employment law world it was a big deal because it does give us better more uniform more uniform protection for trade secrets across the country to cross state lines state law versions also the uniform trade secrets act so we actually had now these days more with better protections for companies to be able to protect their intellectual property okay so you want a business protection agreement because you got on the webinar and you heard this lawyer say we can't have our chapter have this policy what am I going to do I am has invested a huge amount of time and effort and resources I have given so much to my employees and you know what I need to get my return out of these folks I need to get my money back I need to get my return and I don't want them going down the street and working for my competitor as much as I love my friendly competitors fellow members the IEC I don't want them going down the street how do I do it as I said before you don't agree with the chapter and you don't agree with your competitor or not to hire them you enter into this business protection agree and the components are as follows first thing and first and foremost to make this most importantly you can you describe your business and the industry you're in you describe the employees job duties responsibilities and be very clear about their access to critical business information and relationships you want to describe that confidential information in straight-6 is very important to describe it this is why by the way if you went online right now and googled non-compete agreement you'll find something you'll find the form I'm sure LegalZoom and other shops might have them and they may have some of these components but I will tell you that one size fits all template style agreements have got far less likelihood of being enforced and you've got two purposes of these agreements one is preventive maintenance which is simply discouraging folks from trying to to violate the agreement the second most important component is actually enforcing the thing and I'm a big fan of drafting agreements that are actually enforceable not so scary to employees saying the next thing you want to type you want to have in the agreement itself and remember these are these are actually sections that come from my business protection agreement is that you want a reason for the agreement and what that means is you're going to identify the specific legit legitimate business interest underlying the agreement because in order for the statute to apply you have to fit the elements that are in the statute in order for you to have that protection and be able to go enforce this agreement and to get that in to protect your business you've got to check the box and part of checking the boxes to make sure you've spelled out what these what this legitimate business interest is now it may vary state to state there may be there may be some nuances some differences from from one to the next there may be from one state to the next but they are going to be marginal differences these five legitimate business interests come in through the Florida statute but I will tell you that I've litigated these things and probably about probably 15 different states over the years and they all tend to be similar if anybody happens to be calling in from the state of California I will at least qualify this by saying we have recently moved California into our international practice group hopefully somebody got a chuckle out of that but the point is is that California law is dramatically different than in most other states especially in a labor and employment law so don't take my word for anything about about California law final comment here before I go through these is that it leaves really our state specific so you know even as I mentioned earlier if you've got a local lawyer resource that's fine if you don't and you want to work with someone that does this we do have offices around the country that can help because you do need to be stay specific one of the agreements I was reviewing this morning was not and you cannot draft these that are enforceable across state lines across multiple states a handful of states it's possible as long as you know what you're doing but if you try to draft a non-compete agreement that fits the whole country you're never going to get there it's not possible so trade secrets and confidential information those are certainly legitimate business interests for having a business protection agreement in place substantial relationships with specific customers you can also do it to protect prospects if you've been making pitches to them and that it is and the key word here is substantial specialized an extraordinary training let me answer that question the question that may come up pretty quickly as well does that include apprentices the answer is no I doubt that that would apply now say no I mean there's no case that I'm aware of but I would have a hard time arguing that for you because they specialize in extraordinary training is not something you provided even though the company paid for it it's provided to the chapter and it's generally available in the industry what they mean by specialized and extraordinary is just that it is not something that is typical it is atypical and unique a rare if she's not unique and then finally my least favorite one is goodwill well everybody knows our name we are the XYZ electrical contractor in the area everyone knows us it's our brand it's our trade name and part of how we protect that is by making sure that employees don't go work somewhere else I'm not a fan of that one I don't think I've ever won a case because of that one but I know I've had some weaker cases because the employer over it relied on my which one is the best of all these third bullet points substantial relationships with specific customers that is absolutely one that any judge would understand and then any employee would understand protecting trade secrets and confidential information goes right along with that so when you are protecting something very specific something that will cause you to be cut and bleeding it's violated that's what I call and that's what the law would call a legitimate business interest I'm going to pause for a moment before I go to the next slide as I see there's a question so the question reads for apprenticeships students many of us have an agreement that they will not quit working for the company and go to a new company how does this information affect that agreement well again when you're when you're talking about employee agreements between an employer and an employee you have more latitude and I would say that by providing the training it may not be specialized in extraordinary but I would argue because this list is not exhaustive these are not the only file legitimate business interest I would argue that you could be you be able to substantiate the foundation for a for a non-compete agreement with your investment in your apprenticeship student I think that's something that I would be happy to to try and enforce so I think that is I think that's good that's the way about I'd argue that one I think there's some you know the which don't want to have as an agreement from member employer to member employer that we won't hire each other apprentices I hope that the person I asked that question understands that is off-limits but it could be employer to employee that you will not go work for a competitor during a certain amount of time after you leave it doesn't matter whether you're in the apprenticeship program or not there's no carve out for apprentices on there so hopefully that answer the question if not then type and they type in a next one for me all right what are the specific restrictive covenants that you can put into this business protection agreement these are the main one misappropriation or disclosure of trade secrets and confidential information that is an easing one to have in there and then it's an easy one for judges to enforce if there's any evidence in any case that an employee or former employee left and took information about your customers very specific information about your customer even just a list of your customers and went over to a competitor you can stop that person from working for your competitor on this basis solicitation of customers and prospects as long as they're substantial and specific that is easy to protect that is a restrictive covenant you need to have in there now competition yes so coin said I mean this morning while I thought so that you could not prohibit somebody from making the living in their industry the example they used was a plumber I thought you couldn't stop someone from being a plumber well the answer is that's not true you actually can't as long as you do it for a limited geography and for a limited amount of time and again make sure you've got a legitimate business interest for doing so now I will tell you by way of absolute effectiveness and enforcement the best kinds of agreements are those that deal with non solicitation of summers and non-disclosure of trade secrets and confidential information if you want to go that extra step of having non competition I'm gonna put higher scrutiny on you about whether or not you really have a legitimate business interest in stopping someone from going to work for a competitor best example I can give you that is hit the papers in the last couple of years was Jimmy John's Jimmy John's the sandwich delivery folks they had non competition agreements with their delivery folks that got challenged now I can't say I know the exact details of it but I thought the challenge was interesting and pretty compelling storyline because it proves a point that I've been saying for a long time and I have experience in my own cases that the lower on the food chain an employee might be in your organizational chart the less likely I can force a non-compete against that person because they're not likely to have had to have interfered or to be able to interfere with your business because they may not have had the kind of access to trade secrets and confidential information or access to your customers or prospects that would be necessary to support the agreement so herein lies the rub so to speak of the details of a good business protection agreement you need to know how to fine-tune it you need to know how to take that template and then make it specific for your business you can't prohibit solicitation of current employees you can have a part of the agreement and this is where you can actually have we call this one sort of anti rating or anti pirating I don't know why we don't call it anti poaching but we call an anti pirating provision which is where the employee your employee sign an agreement and it says thou shalt not recruit or solicit any employees after you leave here for a period of up to a year or two years you put a put a limitation on that one and then if they start calling on their former buddies who they used to work with at your business then they have violated their agreement the final one solicitation of other substantial relationships such as suppliers is one that seems to be emerging more and more lately very interesting to me that that comes up because I'm not sure that a substantial relationship with the supplier counts but there's not there's been very little litigation on that front if that's something that you consider to be critical to you I mean I deserve some further explanation how do you enforce and then we will be wrapping up here shortly folks but how do you enforce with a cease and desist letter is the first thing you send you don't always send that but it's a typical process because the letter goes to two people it goes to your former employee and it goes to the new employer and at some times we'll get you the result you're seeking because oftentimes we find the new employer had no idea that the person they just hire and had a business protection agreement in place and sometimes that's all it takes to take care of the situation if you have to go to court then your relief is primarily going to be through injunctive relief you file a verified complaint which is under oath we attach the agreement we file at the same time a motion for temporary injunction and we go to a hearing and that's where the cases are won or lost these rarely go all the way to a full trial because if you're able to obtain that initial temporary injunction then you're well on your way to winning the case at the end recovery of attorneys fees and costs must be in the agreement you must have substantial evidence supporting the enforcement of your agreement I cannot emphasize that enough I will not file a weak employment or a weak non-compete case even under my own agreements with Allah I will not file a notice I've got substantial evidence showing violations because if you follow a lawsuit in this area you lose you are not only paying for your attorneys fees you're paying the other side's attorneys fees and they can get substantial so be wary of those so what do you do here's my recommendations and this is where you members who are on the phone and chapter representatives share with your members is that some things to consider first thing update your agreements if you haven't looked at them since the defense of trade secret act as what's passed into law you haven't looked at your own state law developments it's time to update your agreements make sure they're narrowly tailored for the specific legitimate business interests protecting your business be mindful of who will be signing them don't ask everybody your receptionist does not need to sign one in most circumstances how do you implement them that should not be a slash that should be a question mark but how do you implement them I don't believe it's just rolling out a form like this and saying hey sign here I think there should be some education involved employee or a group meeting depending upon who's going to be signing them question comes up from time to time well I have to pay employees to sign one of these agreements and the answer is that you do not need to pay employees in most states because continued employment is enough but some states may require what are you doing to protect your information well you've got to protect your information in some way you can't say it's confidential and trade secrets but give access to everyone and then consider what your enforcement policy and strategy will be you've got a question about whether you don't want to whether you want to force this against everyone or if you're just going to make examples of a few and if finally there's sort of a hyper technical issue that choice that's pulling in law but I won't go into much detail or more so here's my challenge I'm going to wrap it up and then I need to make sure that I didn't miss a question but while I check the question box here will you see I want you to take a look at this and this is what I was the challenge I was going to issue to everyone in the beginning what is one thing that you'll commit to based on new information you learned today make sure it's specific make sure it's measurable and do it today and I mean today and it could be something as small as scheduling a meeting with top members next week and could be something as you know as quick as a phone call but do something today so you can get some momentum coming out of today and pick an accountability partner pick somebody in your office or a buddy or a partner or friends and say hey out this is what I'm going to do or this is what I just done but pick somebody to hold you accountable so that you can that so you can do it and I hope that I hope that you can find something from today if you want to get in touch with me or stay keep update we tend to I send out the things they are social media so there's all the ways to track me down including snail mail and I will check out the box let's see another and did come and many of the IEC standards require IEC to conduct an annual wage survey a first year of apprentices should we destroy the data after receiving from the company not necessarily if the data is obtained properly which means you don't know that you can't connect the information into specific companies then you are probably going to be then you're probably going to be fine on that again the issue is whether or not you know whether or not companies can are exchanging information if they're seeing the information through the chapter through a survey about their competitors specific competitor specific pay that's a problem so be wary of that question how long is a business protection agreement good for I've litigated agreements from 15 20 years ago so they're as good as until the law might change them but the agreements can be enforced for a very long time my preferred practice I think a best practice here is to make sure that you have re-signed fresh agreements once every few years that's not a hyper technical definition of course a few might mean every two or three years but I think that that deserves attention especially if you are serious about protecting your confidential information trade secrets because technology changes access to information changes and it gives you an opportunity to refresh and the importance of the information in the minds of your employees if you just have them signing agreement stick them in a drawer and never talk about them again I think you're missing out on an opportunity to actually protect your business and show the value of those agreements final questions and I think we have to wrap up is how do business agreements affect the actual relationship at relationship status and hourly employees well these agreements if you saw one of my business protection agreement I didn't put this in the slides that I probably should have it will have a specific paragraph in it that says this agreement does not change your at-will status now I'm assuming that we're in an at-will state which most states these days are they explain that well employment is it very simply means that we can an employer can terminate an employee for any reason good bad or indifferent as long as it doesn't violate the law course and their laws on discrimination harassment retaliation at 7:00 but it was you you hello everyone this is Dresden Berlin we seem to have disconnected from Philip so what we're gonna do now that it is okay okay the phone hung up on him so he says to give him a second all right everyone just stay tuned so it's gonna be right back with us in just a minute [Music] boom hello Thank You Philip for coming back I let everyone know that we had this connection and that you're gonna go ahead and continue with answering that question yeah thank you very much I don't know what happened there but the phone just said goodbye all right so anyway to wrap up that last question and thank you drugs and it the the impact of an agreement on the at will and relationship is none it doesn't change it whatsoever but we specifically make sure that the signer understands that the employee understands that we are not employing you for any particular period of time when you sign this agreement now it is possible to have an employment agreement and you wouldn't do this for for hourly line level employees but for some of your executives you may have a more robust employment agreement and part of that agreement you might have restrictive covenants and part of that agreement they may not be at will because you agree to employ them for a particular period of time and to only terminate them for certain reasons and we would call that for calls so the opposite of at will is for calls and so there's your distinction so what has no impact present unless I'm wrong I think I called all the questions that came in I think you did thank you so much for all of your time today this was a wealth of knowledge we all see Philips contact information there so please don't hesitate to follow up with him again this recording we'll be available on the IEC website under the training tab I like to also make sure that you all know Philip is going to be joining us next week again for June 14th at 2:00 p.m. Eastern title of that webinar is chapter membership legal issues do you have to let everyone in the club you can go ahead and read about that description I think it will be another very insightful webinar an opportunity to really get the knowledge that we need today as chapter leaders please everyone do not forget to complete our quick three question survey that will be emailed to you this helps us know what you like or do not like about the content of our 2017 webinar series and we want to make it worthwhile for you so make sure you take these surveys and let us know how we're doing again Philip thank you so much for your time welcome information and we'll see you all next time