Going to Work for a Competitor? Tips to Avoid a Legal Dispute

By Steve Dunn


You’ve passed all the interviews. You’ve negotiated the salary. Finally, you receive the job offer. It’s a great opportunity. There’s only one problem: you’ll be going to work for your company’s direct competitor. It’s time to tell your boss you’re leaving, and she is not going to be happy.


This is an uncomfortable conversation in any circumstance, but in our increasingly litigious society, workers have to worry not just about disappointing their employer but getting sued in the process. Fortunately, there are some commonsense things you can do to minimize the risk of litigation when changing jobs. These same strategies will help you mount a solid defense if a legal dispute is unavoidable.


Needless to say, it is essential to understand any post-employment contractual restrictions you may have. The most common are non-competition and confidentiality agreements, often signed at the start of the employment relationship. Just because you have a non-compete doesn’t mean you’re out of luck. But you should definitely get legal advice before giving notice of your resignation.


Some non-competes are written very broadly, suggesting an employee cannot go to work for a competitor at all. However, most businesses are really only concerned about protecting customer relationships and confidential information. With the guidance of an experienced employment lawyer, you may be able to negotiate the details of a new role to your employer’s satisfaction. Sometimes it’s just as simple as asking for permission.


Whether or not you have to worry about a non-compete, it is critically important not to take any business information or documents when you leave. It is worth going the extra mile to ensure there is no misunderstanding about this. Don’t make the mistake of copying your entire hard drive because a few personal photos are stored on it. Don’t send your contact list to your personal email. And certainly don’t do your employer a “favor” by organizing and deleting thousands of old files.


How do you know what to do with the company’s electronic data? Ask them! As long as you follow your employer’s instructions to the letter, they can’t very well complain about it later. But anything you take without permission may suddenly be transformed into a “trade secret” once the company’s lawyers get a hold of it. When in doubt, leave it behind.


Workers often are reluctant to admit when they intend to go to work for a competitor. They will sometimes pretend they are not sure where they are headed, or even worse, give a misleading impression that they are taking a job or starting a business in a different industry. While this may help avoid an uncomfortable conversation, it looks terrible in a legal dispute. The better practice is to be fully transparent, even if it causes some tension in the moment.


When changing jobs, common sense and the Golden Rule will take you a long way. Although your bosses may not love your decision to leave, at the end of the day they are also business people with careers and families who should understand about pursuing opportunities. As long as you are honest, respectful, and courteous on your way out the door, you will put yourself in a good position to defend a legal claim, and hopefully avoid being sued in the first place.



Before devoting himself to dispute resolution full-time in 2019, Steve Dunn practiced employment law in Charlotte for over 20 years. His practice included FLSA, wage and hour, trade secrets, non-competes, and all forms of employment discrimination. Representing diverse clients from individual executives to Fortune 500 companies, Steve worked in industries including financial services, education, manufacturing, technology, construction, marketing, retail, and motorsports.


As a mediator, Steve is persistent and engaged, tirelessly advocating for resolution before, during, and after the mediation.