Dot the I's and Cross the T's
Have you and I forgotten anything else???? Depending on the type
of job and company - YES! (Otherwise this chapter would not be here)
Before accepting the new job, and well before giving notice to your
current employer, ask
for a copy of the pre-employment agreement.
- Cost of having the job
- Skills you have
- Skills you need
- Impressions of the boss
- Impressions of the coworkers
- Your life
looking to get your foot in the door, watch for the pre-employment
agreement that may stick your entire body in the same place for a
while. Departments wishing to keep their new talent may require the
employee to stay in the position for a time period before transferring
within the company. Some departments, like customer service, have
problems with high burn out rates and resulting transfers out. Other
department managers with bigger budgets wanting to hire someone with a
proven work record may look at other departments as their talent pools.
What Is It?
The pre-employment agreement, is kind of like a prenuptial
agreement; both anticipate the termination of a closer relationship
before it officially moves on to a higher (or hire) level of
commitment. A good pre-employment agreement looks out for the welfare
of the company without stifling your career, provided your career is
not very specialized.
Broad careers, such as programmers,
industrial engineers, nurses, etc... should be able to read such an
agreement and not feel threatened by such an agreement. In the case of
the industrial engineer, the good pre-employment agreement would
prohibit the employee from working for any competitor of that company
for a specified period of time. Thus someone at a soda company may not
go to work for another soft drink maker, but could still accept an
offer from a brewery.
Other agreements may be more career limiting.
Using the example above, let's say that the soda maker feels that all
beverage companies are competitors, despite the fact that brewery
products have a different consumer group. As a programmer this change
of corporate attitude should not be too career limiting. As a
specialized industrial engineer, this could seriously reduce the number
of options for leaving this company.
Making matters worst, the company
may extend it's scope to competitors, clients and other companies which
employ similar technology. In most cases, the soda manufacturer won't
be as strict, so the industrial engineer may go work as a sewage
treatment plant. But what if our programmer and engineer were working
at a pump manufacturer or contract service company? Our programmer may
end up putting on a suit and tie and going to an insurance company
until the expiration of the contract. The industrial engineer may have
to go back to school for a career change or flip burgers until the
contract has expired as any company moving liquids may fall under the
scope of the contract. These are just a few of the ways a
pre-employment contract can hurt one's career.
People looking for jobs
with client or vendor contacts will almost always have more fine print
than those people who work inside the company. Remember - all revenues
(unless you are either a counterfeiter or working for the government)
come from customers who can take their business elsewhere. Thus a
company looks to protect its customer base as to protect its source of
revenue. Good vendor contacts are important to most companies as well.
Many companies need raw material, and with less competition for such
material, the better control they have over the market and the
to ask your boss-to-be to be for a copy of
the pre-employment agreement which you will be asked to sign
starting the job .Do not
accept an excerpt, demand an entire
the agreement or refuse any offers
made by the company.
notarized copy of what you just received in the event that the "revised
edition" which you will be required to sign on your first day differs
from the "copy" you received earlier. If they differ, get a copy of
what you are signing for "your records" and see a lawyer. Bait and
switch is dirty business no matter how it's applied. If this is how
you're being treated on the first day, the honeymoon period is over.
Your Own Time & Insurances
As many employers are looking to reduce
the cost of health insurance, employment agreements may get into
details of your personal life. Many people feel that whatever they do
off the clock should not been any of the company's business, while
companies feel that they should have some say in such activities as a
way of controlling health insurance costs.
While smoking tobacco by
people over 18 is legal, many employers find that a smoking employee is
much more costly to the company than a comparably skilled nonsmoker.
Employers and insurance companies have statistics that point out that
the smoker will probably be sicker, take more days off and actually use
the insurance policy. Thus a bias against smokers may result.
companies do background checks and drug tests as to weed out potential
trouble. Some companies may also insist that to maintain employment,
the employee can not be involved in any questionable (anything which
draws police attention or could get your name published in the "Police
Beat" section of your local newspaper) activities during off hours.
Companies falling under DOT regulations may randomly drug test
employees, and refusing such a test may result in immediate
One facet of the pre-employment agreement, like
the pre-nuptial agreement, looks to split property brought into the
relationship and property gained by both parties during the
relationship. Salespeople are commonly required to have no contact with
the company's clients for some period of time after the time of
termination. New client relationships made during the time of
employment frequently become like property to the company; you will not
be allowed contact them for some time. If all this sounds reasonable, I
feel the same way. The company is looking to protect assets it
developed before your arrival and the assets the company paid you to
Now let's look for the hidden screw. In some cases the hiring
manager is looking for more than just your warm body and brain to fill
the open position. For example, when hiring salespeople, a manager may
be looking for someone who already has a list of contacts to start
working with day one. A software company may not only hire you for
skills that you have, but also for ideas that you may have discussed
during the interview. So, in the case of the sales person, are these
contacts brought in by the new hire now the "property" of the company?
Ethically no, but this is business, so you must supply the ethics.
you sign the agreement, you also assume the burden of proof should a
legal battle arise. In the case of a software developer with an idea,
the company may hire you to either further develop the idea within the
company or as a move to crush competition (kill your opportunity).
Remember, once the agreement is signed, especially if you have not
taken any action, you've just gave the idea to them, possibly for free.
With the signing of the non-compete
agreement, you have just lost
some intellectual freedom, much like a new car looses value when driven
out of the showroom; you've barely gone anywhere and there is no
Non-compete clauses may sound simple and innocent,
especially if you are going for a non-technical or non-managerial
position in a company. You may feel that your job as a secretary can be
done by anyone (but you can do it better than anyone) and that you can
do your job anywhere for anyone. You may feel that any company who
hires you, including the company's competitors, is getting a good
employee but no real trade secrets in the process of hiring you. Key
word here is "feel".
Feelings do not matter when a contract has been
signed. For example, if a janitor at a software company signs a
non-compete agreement, he may not be able to mop the floors at any
other software company after leaving his/her current company for
whatever reason for an agreed amount of time. Non-compete clauses may
go further than just career / for money activities, they may prohibit
you from enjoying your hobby.
As a programmer I have made plenty of Web
pages (and one does not need to be a programmer to write Web pages) for
myself and friends on my own time. A company which hosts, creates or
has a financial interest in such may prohibit employees from doing such
an activity on personal time because someone (manager, owner, etc...)
in the company feels that you are infringing on a potential market.
Thus a company which specializes in automobile maintenance may require
that employees no longer fix cars in their backyards. Do not disregard
such agreements, as once your signature is on that agreement, you have
just made your personal activities part of your boss's business.
Further more, to protect their customer base, companies may require the
mechanic not to fix cars in their backyard on personal time for a
period after employment termination. In short, by signing such an
agreement you may sell your soul.
Many people not only make money by working for someone
else, but also put that money to work for them through investments.
Investments may be passive, such as CDs (Certificates of Deposit),
semi-passive like stock portfolios and investments may have you quite
active, such as rental property. Unless you are going to work for a
bank or type of investment firm, most passive investments should be OK.
As an investment gets closer to your company, the further you should
steer from it. Do NOT invest in your company through channels that are
outside your company, as doing such may well be considered as insider
trading. Also avoid trading the stock of customers and vendors as you
may have to discuss your inside knowledge of such companies to a judge
as well. The judge may argue that because you may know how a customer's
business is doing by analyzing sales figures from your company to their
company. The judge may also argue that you can tell how a vendor is
doing based upon price increases and decreases to your company.
Active investments may be looked at in almost the
same light as the backyard mechanic - you are personally cutting in on
the company's (or firm's) potential market. Someone working for a
contractor may not be allowed to buy old houses and fix them up for
sale at a profit as you are cutting into the company's potential
market. The same could hold true for a professional like a lawyer or a
realtor. Such a professional could manage rental property on their own,
but will have to use their professional skills from time to time as to
collect past due money or evict tenants. The firm's position may be
that they hired you to do a job for them only and that, once again, you
are cutting into their potential market. You may feel that everyone of
your coworkers are morons and would have never used this company's
services, but once you've signed the agreement, you've put the morons
in charge of your life.
During the interview, it is very hard to tell the
hiring manager's intentions. Ask what they are doing with the concept
and how they have implemented it or how they plan to do such. Later
during the interview, ask the same questions from a different angle. If
the answers are similar, the company is going someplace with the idea.
If the answers are quite different, the interviewer is either using
this time to get free consulting advice from you or looking to hire and
lock you into a non-compete agreement.
Legal? Hard to prove that
anything illegal was done at an interview.
Ethical? No. Remember this
is business and you have to supply the ethics.
How can you protect your
intellectual property? I can not give you an answer,
but get a copy of
the pre-employment agreement (non-compete agreement) before signing
anything and talk to a lawyer. One way to quickly and cheaply give
yourself a leg to stand on (rights will vary depending on state, the
wording of the agreement and how good both side's attorneys are) is to
document your ideas, lists, etc... and have them notarized before your
date of hire. Even better might be to have the documents notarized
before the second interview, as trade secrets may be discussed during
the second interview. At this point invest your time into protecting
you and your future rights to the idea. Develop the plan to the fullest
that you can in the time before signing the agreement. After you sign
the agreement any further development of the idea may become the
company's property, especially if you can not prove that you could have
derived such further development on your own.
Once you sign the
agreement, you have taken on the burden of proof should a dispute
arise. For example, you have an idea to write the ultimate Black Book
(personnel phone directory) program. Document
- The purpose of the program
- It's functionality
The information (input) required from the user
- Easy name look ups, based on parts of names,
- Splits phone bills in roommate situations
- Reminds of
important dates - birthday, anniversary, etc..
Reports (output) it will produce
- Names, addresses, phone numbers,
dates of events
- Who usually calls which number(s) in the database
- The phone billing charges
- Who's responsible for any special options
(Call Waiting, Call Forwarding, Three Way Calling)
Algorithms to take input and produce output.
Marketing ideas that will make the product viable
Code the prototype !!
I am not saying make a final product, go for
version .1, a quick and dirty prototype. Do it in a language or package
that might not give you the full functionality, power or freedom, but
one that will make a functional prototype. The code may not be
reusable, but the main algorithms will have been captured and proven to
work. Also note shortcomings of the prototype and what you think needs
to be done as to make the prototype become a viable product.
- Card mailing lists for
- Separate bills for each person who used the
- Unclaimed charges
make the prototype, you will bring the idea from an intangible concept
to something real that can be seen by others. While coding you will
gain a knowledge that you will also need to document and notarize
before your first day of employment as to keep the creation yours.
Remember, a company can not take away knowledge, but the pre-employment
agreement can render you powerless over your own creations.
As a poor
example - the prototype may be case sensitive, but you'd want to
overcome that problem in before your first release. Fixing the case
sensitivity will not change the over all program, but the employer may
try to make some claim to this idea. Sounds petty, but how frustrated
would you be if you spelled something correctly, but still could not
find the item because what you typed was not in the same case as the
letters in the database. (Case Sensitive Smith finds Smith not SMITH,
(Case Insensitive Smith finds Smith and SMITH, smith sMITH)
Termination Of Employment
I will dare to assume at this time one of the
last things that you are thinking about is the termination of your
employment from this company and how it's going to affect your distant
future. Invest the time to protect yourself and your future rights to
your ideas. Document as much as you can and get indisputable proof that
you created this documentation without any knowledge taken from that
company. The best method I know is to get it all on paper (print it out
if you used any type of computer application) and get a notary to sign
and date it before your first day of employment. Legal rights may vary,
but you have to start someplace. You have invested a lot of time and
money into your career. Education, licenses, certifications,
experience, etc... can become meaningless if you sign the wrong
pre-employment contract. Take the time to investigate the
pre-employment agreement and it's affects on your career and your
future with the company and after you leave. You must protect the
investment that you put into yourself.