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Thread: contract agreement thing... whats your opinion?

  1. #1
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    contract agreement thing... whats your opinion?

    so i'm gonna be doing some contracted work, and i need to sign this non-compete agreement, which is understandable... i havnt had much experience with legal documents and whatnot so i just thought i'd get a more educated opinion so i'd know for sure. here is the agreement

    "EMPLOYEE NON-COMPETE AGREEMENT

    For good consideration and as an inducement for_________________ (Company) to employ _________________________ (Employee), the undersigned Employee hereby agrees not to directly or indirectly contact clients, use trade secrets and knowledge gained while in employment with the Company without the written agreement of the Company at hand.

    The term "not compete" as used herein shall mean that the Employee shall not in any way, contact or consult while employed, and or after employment, in anyway with such clients of the Company, without the knowledge nor agreement of the Company. Which to the Employee may not, in any case try to or attempt to persuade clients from leaving the Company and using the Employee who has been in contact with them.

    The Employee acknowledges that the Company shall or may in reliance of this agreement provide Employee access to trade secrets, customers and other confidential data and good will. Employee agrees to retain said information as confidential and not to use said information on his or her won behalf or disclose same to any third party.

    The Employee must also not display any work created for Company on any web site not associated with the Company.

    Assignment of Developments: I hereby assign to the Company or the Company's designee, my entire right, title and interest in all of the
    following, that I conceive or make for the company:

    (a) all Developments;

    (b) all copyrights, trade secrets, trademarks and mask work rights in
    Developments; and

    (c) all patent applications filed and patents granted on any Developments,
    including those in foreign countries.

    This non-compete agreement shall extend only at the time of employment in set with the Company and shall be in full force and effect for until employment is ended with company, commencing with all trade secrets will be kept confidential by the employee.

    This agreement shall be binding upon and inure to the benefit of the parties, their successors, assigns, and personal representatives.



    Signed this _____ day of ________________________ 20____.



    _______________________________________
    *******, LLC (Company)


    _______________________________________
    Employee"


    also he said he needed my social security # for tax purposes, which seems reasonable.

    so, what do you think? look good?

  2. #2
    PAZ nordberg's Avatar
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    non-competes are very common, and usually not a big deal. i don't like the line that reads, "The Employee must also not display any work created for Company on any web site not associated with the Company." what if you want to use the work you do in your portfolio? according to that, you can't. if not the entire piece, maybe they would allow you to use screenshots.

    don't worry about the SSN - that's normal.

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  3. #3
    supervillain gerbick's Avatar
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    I sign non-compete's all the time. However, only alarming issue I have with your above listed one is there is no mention of time limits, no mention of pre-existing technologies known to you and your field that may be determined as "common knowledge" (thus non-competing because you already knew that information), and that I don't see where there are any provisions to list out what they consider "trade secrets" at a later date if an inquiry were to be made to what is competing technology.

    For instance, if they say something like data reduced XML schema's (XDR schemas) are considered "trade secrets" then that's so broad, that would mean you couldn't work with Microsoft XML schemas from BizTalk to MS Office 2003/2004 (Mac). Thus limiting your future employment, but enabling them to broaden how much they control you in the future - and how they can sue you if need be.

    Just something to think about. Most non-compete clauses that are too broad though, are usually considered non-enforceable. Had that happen to me once as well.

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  4. #4
    http://www.flipshark.com flipshark's Avatar
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    I'm also wondering if this was written up by a lawyer, or just "some guy".

    Most legal forms like this are 5-10 pages long with definitions and specifics (as gerbs said, specifics are lacking).

    This is sort of a blanket contract, so I would avoid signing it until it is clarified.

  5. #5
    Senior Member dlowe93's Avatar
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    Re: contract agreement thing... whats your opinion?

    Actually, it's pretty loose. It only says that you can't contact clients while you are working with them. Typically a non-compete lasts for 12 months after you stop working with a company.

    The only thing that gives me pause is that, according to this, you can use any of the work you do to promote yourself online:

    The Employee must also not display any work created for Company on any web site not associated with the Company.
    I would be clear and find out if there is any flexibility with this, or at the least you can use client names and project types as part of your client list. Of course, worst-case scenario, it says "web site". You could still create PDFs of case studies and make them available for download.

    And the SSN is normal and legal. They need it for their tax purposes, unless you have a business Tax ID number, then you should use that.

    Hope this helps,

    d.
    dlowe93

  6. #6
    supervillain gerbick's Avatar
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    Re: Re: contract agreement thing... whats your opinion?

    Originally posted by dlowe93
    Typically a non-compete lasts for 12 months after you stop working with a company.
    I was working with a company that a lot of people here know, and I was involved in a non-compete/non-disclosure agreement for a specified term of 60 months.

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  7. #7
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    Hi

    I just happened to stumble across this post and felt that some facts and suggestions regarding non-compete agreements in general and this one in particular.

    First, many states (such as here in Colorado) will not allow non-compete agreements to be enforced if the employee does not have an employment contract in place as well.

    If you don't live in the US, then disregard because no one would try to enforce anything anyway. =)

    The things that concern me about this particular agreement is the vagueness and very loose terms used. This is a very poorly written agreement, unless you are the employer. =)

    For example, "use trade secrets and knowledge gained while in employment". The problem with that is it states "while in employment" which sets a condition during which the trade secretes must be learned and/or knowledge gained. Unfortunately, this does not specify which knowledge or how or why it is learned. This could be used to claim rights to research done or work done outside of actually working for the employer as it is done during the term of employment.

    The next problem is: "Employee shall not in any way, contact or consult while employed, and or after employment, in anyway with such clients of the Company"

    This is also non-specific. Essentially the problem is that it says that while you are employed by the company and after your term of employment, you cannot contact their clients. The problem is that it binds you to not contact people, companies, etc. who become clients after your term of employment. This does not seem fair because it literally bars you from competing with the company indefinitely.

    The whole Assignment of Developments section is just redundant because, as an employee of a company, any works made by you for the company are automatically owned by the company including copyrights and right to seek patents.

    The paragraph immediately following that section is nonsense and doesn't even make sense in legalese.

    As a person who hires employees and sub-contractors for my company, I will give you some advice:

    First, if you are working as a sub-contractor, NEVER sign anything that refers to you as an employee. As I mentioned before, this gives the company immediate ownership of your works and, let's say in a worst-case scenario, the company does not pay you any money up front and decides to just tell you they want the work before they pay you, they could refuse to pay you and even have a court order you to turn over your work and there is nothing you could do about it. Sure you could then go after them for the money, but let's be honest, as programmers/developers we have all relied on the fact that we don't turn over source until payment is made to keep the client honest. Sure this is an extreme example, but companies do many things to protect themselves, you should too.

    Terms to avoid completely: referring to you as an employee, referring to the project as a work for hire or work made for hire, either of these gives the company immediate copyrights to the work.

    Avoid non-compete and non-disclosure agreements that do not set a specific duration.

    I will be honest, when employees and sub-contractors sign contracts with us, we do refer to them as employees and the project as a work for hire. This is to protect our interests from disreputable programmers. If you ever have to hire someone, I suggest you do the same. However, I am simply offering you advice on how to protect yourself in the reverse position. =)

    You may never run into any of the situations I describe, but is it worth the risk if you put in 100 hours of work on a project and deal with a company of questionable character?

    - Kyle

  8. #8
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    i wont go into the details, but i will link you to a 3 page article that explains it and links you to a state by state law search for non-compete contracts, i have also provided a link for a pdf that has the latest revisions to the law as of april 2004.

    http://jobsearchtech.about.com/libra...y/aa042202.htm

    http://www.armstrongteasdale.com/New..._April7-04.pdf


    good luck.

  9. #9
    Senior Member dlowe93's Avatar
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    Re: Re: Re: contract agreement thing... whats your opinion?

    Originally posted by gerbick
    I was working with a company that a lot of people here know, and I was involved in a non-compete/non-disclosure agreement for a specified term of 60 months.
    Yow! That's just silly. Not only is it hard to enforce, but having the same team both client side and agency side for five years is rare. I'm coming up on my 12 months with an old employer and belive me, i'm going to melt some phones.

    d.
    dlowe93

  10. #10
    supervillain gerbick's Avatar
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    Originally posted by dlowe93
    Yow! That's just silly. Not only is it hard to enforce, but having the same team both client side and agency side for five years is rare. I'm coming up on my 12 months with an old employer and belive me, i'm going to melt some phones.
    lol. dude, best of luck to you. and I knew what I was signing when I signed it... just wanted in, and a free trip/stay in Japan so badly, that I agreed to it.

    still was cool, and since I signed it, and the technology never truly became "common knowledge", I held to it. But it was one of the coolest things I had ever worked on.

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