Companies want to protect their assets, including their trade secrets, their client/customer lists, and the company’s most important asset: its own workforce. Companies invest significant resources to on-board new employees, put them through orientations, training sessions, retreats, and of course, provide them with salaries, commissions, benefits and other perks. They also become privy to confidential information and trade secrets. Simply put, good employees are difficult to find, and losing a good employee can be quite a setback for an employer. But change is inevitable. Employees leave good companies.
To limit the possibility of an exodus of employees (and customers as well), employers often require new employees to enter into agreements that contain restrictive covenants. The most common of those covenants are 1) Non-solicitation, 2) Non-disclosure, and 3) Non-competition. (Did your employer require you to sign an agreement with any of these provisions? If you are an executive, manager, or involved in sales, public relations, and/or marketing, then you are likely subject to one or more of these restrictive covenants. Go ahead – find a copy of your agreement now and read it carefully).
What is a “non-solicitation” agreement?
Typically, a non-solicitation agreement prohibits an employee from, directly or indirectly, enticing or soliciting any current employee of the company to end his/her employment with the company. Losing one good employee is a detriment to a company. That detriment is multiplied, however, if that one employee entices (solicits) some of his/her former co-workers (and/or customers) to leave that same company. Generally speaking, such non-solicitation agreements are enforceable, but state laws differ on the scope of such agreements.
How Is Social Media Involved with Non-solicitation Agreements?
Let’s say your job is in sales or marketing for your company’s products. Because of your role, your employer required you to sign an agreement with a non-solicitation provision. During your employment with your company, you used Facebook, Twitter, LinkedIn, and other social media accounts and you “friended,” “followed” and “linkedin” with many of your co-workers, supervisors, and some of your clients/customers too. (Read why being a Facebook “friend” or connecting on LinkedIn with your co-workers and supervisors may not be a good idea, here).
Then, eventually, you leave your job in order to join a new company selling a similar product. Understandably, you want to update your social media accounts to reflect your change in employment. (Side note: Depending on what state you are in, you may need to be careful that you are not violating any non-compete provisions in your agreement with your erstwhile employer. For example, in California, non-compete agreements in employment are generally unenforceable (with some exceptions of course). And, in other states, they may only be enforceable if they are narrowly tailored in geographic, temporal, and substantive scope).
Would your status update about your new job violate your non-solicitation agreement? How can you tailor your update to minimize the risk of your former employer suing you for breaching the agreement, and other related claims? And, what can employers do to make non-solicitation agreements and related policies more likely to be enforced against a departing employee and used to protect its assets?
Tips for Employees With Non-Solicitation Agreements:
1. Read your Agreement closely before you post anything.
It is always a bit surprising how often people do not read employment agreements closely. Some of it is understandable: you are excited to be joining a new company, perhaps getting a higher salary and more impressive title. If you did not read your agreement closely when you joined the company, please be sure to read it very closely when you contemplate departing. The agreement will spell out what the company believes you can and cannot do upon your departure. That will be the starting point of how you should tailor any actions you take regarding joining a competing company or updating your new employment information.
2. Understand what “solicitation” means.
If your employer is rather sophisticated (or has read some of my tips for employers below), then its definition of “solicitation” should contain examples of activities the company believes violates the non-solicitation covenant, and may specifically address the use of social media. So, the agreement might prohibit you from voluntarily telling former co-workers that they would likely get a higher salary or better benefits, elsewhere, or other information to entice or lure them away from your former employer. In reality, however, most non-solicitation agreements merely say generically that “employee agrees to refrain from soliciting employers’ employees.” If that is the case, you have more flexibility.
3. Don’t target your updates to certain employees/customers.
In a recent case in Oklahoma (Pre-Paid Legal Services, Inc. v. Cahill), an employee left his company to join another. He updated his status on social media, and he posted positive information about his new employer on Facebook and Twitter, and he sent requests to some of his former colleagues to follow him on Twitter. His prior employer was not happy, and sued him for numerous claims, including a breach of the non-solicitation agreement. The federal court found that the employee did not violate the non-solicitation agreement. In essence, the court found that the employee’s posts were general announcements, and not solicitations to former colleagues, nor were his posts even targeted to his colleagues. For example, he did not directly email any of his former colleagues.
The court relied on analysis from two other courts that decided similar cases. In one case from Massachusetts, a court found that Facebook posts announcing a new employment situation and “friending” clients of a past employer did not violate a non-solicitation agreement. Similarly, a court in Indiana determined that posting job openings on LinkedIn, even if accessible to former co-workers, was not prohibited “solicitation.” A more complete analysis of theses cases can be found here.
Tips For Employers To Protect These Assets:
1. Beef Up Your Non-Solicitation Provisions.
Don’t just rely on your company’s old non-solicitation provision where terms like “solicit,” “entice,” and “lure” are not accompanied by examples. The more examples the better, but be sure to include a disclaimer that such examples are not the only such types of solicitation prohibited by the agreement. And, explain that certain uses of social media can be considered by the company to be in violation of the agreement.
2. If Possible, Communicate With The Departing Employee About This Topic.
Presumably, if the employee is leaving on good terms, then this tip will be easier than if the employee is being involuntarily discharged. If the split is relatively amicable, employers should consider discussing with the employee what the employee would like to do in terms of communicating his/her separation from the company, and such a discussion can serve as a reminder to your employee of the terms of the non-solicitation agreement. A simple, non-threatening conversation can go along way to avoid misunderstanding, paranoia and litigation.
3. Determine Ownership Of Social Media Profiles At The Beginning, Not The End.
When a new employee is hired, and is likely to be using social media for work-related purposes, employers would be wise to determine at the time of hiring who owns the social media accounts that the employee will be using. Of course, to maintain the most control, the employer will want the social media accounts to be considered as owned by the company, and will direct the employee to use other social media accounts for personal posts. Thus, the employee can use such accounts to perform his/her job, but ultimately those accounts, including the account’s connections, friends, and followers, belong to the company. The employee will still likely have their own social media accounts that they use for personal purposes, so the employee will still be wise to follow the first two tips above.
Information provided on this website is not legal advice, nor should you act on anything stated in this article without conferring with the Author or other legal counsel regarding your specific situation.