“We’ve been watching a former employee for a while and know he’s violating his non-compete agreement. What is your lowest rate to conduct surveillance?” Similar calls are increasing to one private investigator in Atlanta, Ga. He says it’s due in part to changes in Georgia laws over the years and the misconception by some that Non-Competes and Non-Disclosures (NCND’s), can’t or won’t be enforced. “Negative financial consequences occur to employers when a NCND is violated. They’ve put their sweat equity and monies into training someone. Often, proprietary data, industry practices and connections are revealed. Now the hand that once fed, is bitten.”
Some say that proprietary information aside, non-competes are inherently unfair. It prevents people from earning a living and stifles competition. It results in the loss of overall value to the end user. The investigator responds, “That’s a 50,000-foot opinion but not necessarily true. Think of the start-up entrepreneur who has thousands of hours of research and development. A process, product or relationship potential was out there. An individual or collection of individuals had the fortitude to bring everything together. In terms of competition, a maverick employee might say ‘I can do it cheaper’ and makes a leap. They contact their former employer’s customers and shazam, they can’t always do it better. So, who suffers now? It’s both the original employer and now the customer who receives sub-standard results.”
So, if an employer suspects a NCND has been violated, can they perform their own surveillance work? The same investigator says, “When it comes to organizations performing their own surveillance, it’s trickier. There may be investigative licensing issues and a company’s labor attorney correctly addresses it. It’s an area that opposing counsel will explore. We are then contacted about conducting independent work.”
He was asked further about potential clients wanting the ‘lowest rates.’ “If you want the lowest rates, you may get the lowest quality. There lies a misperception that investigative work is a commodity. The business and labor attorneys we work with completely understand and have never pushed back.” He also says clients selecting their company for corporate investigations are pleased with the extra effort put forth.
The investigator emphasizes the need for proper legal consultation before a company rushes to action. “While we certainly don’t provide legal advice, we pose questions and scenarios to our clients. For example, can the former employee show that they left under duress? Were there unethical or illegal behaviors in the workplace?”
The investigator who is also a Certified Fraud Examiner (CFE) mentions other possibilities. “Consider a former employee who goes to work for a competitor, which on the surface seems like a violation. What if it’s in a completely different position? Understand, the employees’ intentions may be to ride out the time on the non-compete and then slide into a former role. However, when examined further the language in the NCND was vaguely written. Maybe it was downloaded off the internet. It may not be relevant to your state’s laws. This is why sound legal advice is critical.”
The CFE’s also notes that options may exist other than surveillance work. “Surveillance in itself may not be the only approach. We prefer to view a copy of the NCND and establish a strategy with the attorney and executive leadership. Different tactics could be applied that adds more clarity. Often, overwhelming evidence is obtained that really strengthens a case.”
The lesson says the CFE is not to be fearful of enforcement, just the opposite. At the risk of sounding like a broken record he reiterates to get good legal counsel first, which includes the proper crafting of an NCND. Afterwards, they are eager to assist. “It’s a real problem. Companies would be wise to properly communicate the consequences for violations. Think of today’s hi-tech world where your proprietary information or process is so unique. Your customers are yours. You developed the relationships. You own it and you didn’t work hard to let your baby be stolen.”
Angela Spearman is a journalist at EzineMark who enjoys writing about the latest trending technology and business news.
