With an at-will employment arrangement, an employee enjoys the freedom to leave an employer without reason.
Contracted employees do not enjoy this freedom but are bound by the terms of their employment contract. Many of these documents contain hidden clauses that negatively impact an employee’s legal rights.
A confidentiality agreement cancels an employee’s ability to share any information about their employer, whether it is processes, trade secrets, plans or other information. These clauses typically extend this restriction beyond an employee’s time with a company. Divulging confidential information, even after you have left a company, could lead to a lawsuit. This is possible whether you go to work with a competitor or release the information through social media or other channels.
The wording of these clauses prohibits employees from working for a competitor or company conducting similar business within the industry. Though a clause could contain specifics limiting the restriction to a time period or geographic region, some companies try to expand applications for the non-compete. In these cases, a court could invalidate the clause and deem it unreasonable.
Ownership of invention clauses
Employees who work with the development or discovery of devices might sign a contract that relinquishes any ownership of a product. The wording states that the company or entity owns any devices released and not the designing individual.
It is important to carefully read through the terms of the employment contract before signing on the dotted line. Keep in mind that employee handbooks are often “implied” employee contracts.