Employee Mobility

Employee Mobility

Employee mobility is a top issue for many San Francisco and Silicon Valley companies right now. Employee mobility is when an employee leaves an organization and moves to another company, particularly a competitor. This transition may trigger a number of complex and intricate issues that can potentially lead to litigation. Besides the personal animosity, disruption of business, and possible interference with strategic planning, the exit of a high-level executive or upper-management employee implicates California laws and public policy.

In an effort to minimize the risks associated with employee mobility, employers often require that their employees sign  non-disclosure agreements (NDAs), non-compete agreements, and non-solicitation clauses that may or may not be enforceable, depending upon the employee’s location and other critical considerations. These considerations include whether or not the employee has equity rights in the former organization, the form of the business entity, and efforts by the employer to protect its intellectual property. Whether the exiting employee is coming from a partnership, a closely held corporation, or a large corporation with stock options may dictate whether the employee can work for a competitor or start their own business.

The Louderback Law Firm recognizes that employers hiring new employees on an executive and management level need to be mindful of the limitations of California Business and Professions Code Section 16600. While non-compete agreements and non-solicitation agreements together with contractual notice periods are not enforceable in the state of California, employees are nevertheless prohibited from taking confidential trade secrets from their employer. In addition to the advice and consultation we provide, the firm has engaged in successful litigation that has demonstrated its ability to enforce trade secret rights.

The Louderback Law Firm counsels companies trying to protect trade secrets as well as executives and other high-level employees who seek to move to a competing organization. The firm provide assistance throughout the transition process, including contract review and advice on competing fairly without violating contractual and statutory obligations to their current employer.