Here’s the scenario… You’ve hired a great employee. She’s always on time, does everything you ask, never complains and makes all the customers happy. You slowly build a relationship with her and begin to hand over more and more responsibilities. Because of the nature of her job, she meets your customers, sees your brands and works on your email list. Then one day, the boutique across town offers her more money. She’s known the owner for years, and so she tells you goodbye and heads to where the grass is greener. Or maybe instead of moving to the boutique across town, she decides that she’ll just be the boutique across town and open her own shop. Not only is she leaving you without an employee, but she’s also taking all the information she’s learned with her… the brands, customers contacts, operating manuals, etc.
What can you do?
Before hiring any employee, your due diligence is crucial. While you hope for the best, you prepare for the worst by simply having contracts and plans in place. Two of these contracts that employers should always consider negotiating with their employees are non-disclosure contracts and non-compete contracts.
A non-disclosure contract contains language that prohibits the disclosure or distribution of confidential information by an employee. This is such a vital document because it protects you, as the business owner, when your employees leave to go elsewhere. Essentially, it prohibits them from sharing confidential information that they learned because of being employed by your boutique.
On the other side of that is the non-compete contract. This protects you, as a business owner, from having an employee come into your business, learn all of the tricks of the trade and then leave to directly compete with you.
Often, non-compete contracts and non-disclosure contracts are compiled into one contract or even made part of a bigger employment contract, but whether they stand alone or become incorporated into another document, they are critical in protecting a business owner.
Both of these documents can be looked at with scrutiny if challenged in court, so working with an attorney is always wise when entering into any legal arrangement.
As they say, an ounce of preparation is worth a pound of cure, so when you find your next new employee, besides using these contracts, a full conversation with expectations, details, long range goals and vision, detailed checklists and company guidelines or handbook can save you major head and heartache.
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BONUS: For MEMBERS of The Boutique Hub, find two sample NON-DISCLOSURE and NON-COMPETE CONTRACTS in our Training Library for you to read, then contact your own attorney to review and finalize. These two contracts are samples for your knowledge, but not to be used without your own legal consent. Provided courtesy of The Law Offices of Emily Daniell, PLLC, email [email protected], also a fellow boutique owner!
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Hero Image Photo Credit: The babes over at James and Alma!