Q. We are hiring a high-level employee who will come to us from our major competitor. She has no noncompete agreement with her current employer. Is that our only risk?
A. While this employee may not have a noncompete, there are several other potential pitfalls when hiring an employee from a competitor.
One of the most critical is to avoid unlawfully obtaining your competitor’s confidential information.
All employees are restricted by state trade-secret statutes, and many employees work under employment contracts that include confidentiality restrictions. Make sure your company does not request any sensitive information from her former employer—and direct your new employee not to retain or bring with her any such information.
Also, try to ensure that the employee does not “jump the gun” and begin working for you before ending her employment with your competitor.
It’s important to be proactive in your instructions to the employee, remembering that even seasoned executives may ignore these basic legal duties.