Greetings Brethren,

I'm pretty new to this consulting game (about a year and a half) and while I try to avoid working through headhunters, sometimes I find that they're a Necessary Evil (although usually I find them to be just Plain Evil. :)

One clause I find in almost all agency contracts is an "exclusivity clause" that says 1) I agree to not to work for the company outside of the agency for some period of time (usually between six months and a year) after the end of the contract without their prior authorization and 2) if I do, I agree that they can sue me.

While I don't think that asking for exclusivity is wrong, per se, I do object it being put it into my contract. I feel that if the agency wants this sort of arraignment, then it should be between them and the company. After all, the agency has lawyers, the company has lawyers and if there is even the slightest possibility of any litigation, I want to keep it between them. I don't have any lawyers.

(As an aside, I do think that the "X months after the end of the contract" is too long. I think pegging any time constraint to the start of the contract would be fairer to both the contractor and the company. After all, if I work through an agency for six months, that should be more than sufficient compensation for whatever work the agency has put in.)

Normally this isn't a problem for me. Normally the agency will fax over the contract, I'll read it over and strike out or amend whatever I don't like, sign it and fax it back. Then there's usually a short phone call where I have to explain my thinking. Normally it's smooth sailing from there. I work, the agency gets paid and everyone is happy.

A couple of months ago, though, I had an agency contract fall through because we couldn't come to terms over the exclusivity clause (I also found out that this agency had trouble agreeing to a contract with the company, so maybe that particular agency is just incredibly inflexible.) I didn't mind terribly. I figure it's better for me to be a little patient and only sign a contract that I'm comfortable with, rather than sign something I might later regret.

How do my fellow monks deal with this? Does you find exclusivity clauses in your contracts objectionable or am I just being overly idealistic and/or paranoid?

-eg

Replies are listed 'Best First'.
Re: Headhunters and exclusivity clauses
by lemming (Priest) on Jan 06, 2001 at 01:48 UTC

    I don't have problems with agencies that make an arrangement with the company that you'll work at. Pay agency X amount if you're hired during this time period. (Usually a sliding scale. The sooner you're hired, the more money the agency gets.)

    My current agency works on a six month time limit where the company can't hire me as an employee during that time. After that, no problem on the legal front.

    I've also seen the non-disclosure contracts getting weird at times. I was supposed to sign one while I was an employee of one firm that said they could examine anything I did for two years after I quit. That I crossed out along with other non-legal items before signing. I think I left an illegal one in that was non-applicable just as insurance if I missed something else.

    Bottom line: Agencies and companies will do as much as they can get away with. Fight them on the unfair parts, which it sounds like you do.

    Update: Due to Blue's comments. The NDA that they had wanted me to sign was also a "Sign or leave document" After hammering at it for 10 months they finally came out with one I would sign. Though at the time I was in a fairly critical position so I knew I couldn't get fired without them losing half of their business. Plus I had a manager that whenever the president would ask him "How long would it take a new college grad to get up to Mark's level?", my manager would say four years. I never peed in a cup for them either.

      lemming brings up a good point here:

      I never peed in a cup for them either.

      I'm willing to bet that most people swayed by the biting "documentary" stories they see on Dateline, and other hard-hitting news programs, would immediately say, "This person refuses to submit to a piss test, so he must be doing drugs." That's disturbing that most "mainstream Americans" would accept this form of intrusion (any type of drug testing) without flinching. So, I figured I would just say thanks to lemming for "stickin' it to da man". :)

      As an aside, it'd be interesting to see variations of this in a poll. I'm wondering if it's truly an extension of the community's support of privacy or if it's a necessary extension for fear of being caught. Furthermore, does recreational use (if applicable) affect your ability to work?

      ALL HAIL BRAK!!!

        At one company I used to work for, there was an unwritten policy of not doing drug tests, since we would have lost a great amount of our creative talent...

        Yeah, for what it worth (and, market willing, I'm worth a reasonable amount); I'll never pee in a cup for anybody. If they've got a question about my 'past life' (hey, I'm married w/ a child, those days are, alas, alack and its not so bad, over) or my "usage" ask me, but no amount of cash'll get a sample out of me.

        Or so I say I now, the 'w' future may be different ;->.

        a

      I think I left an illegal one in that was non-applicable just as insurance if I missed something else.

      If you did that, you wasted your time. One bad clause doesn't void a whole contract. And just to make sure, most boilerplate includes a clause that says something like, "... and if a clause is found to be invalid, that portion will be struck without voiding the rest of this document..." only in much deeper lawyerese.

      Now the last place I worked was hyper-active about such things but when they got bought and then re-merged our old employee contracts and agreement were voided and the new ones were much less intrusive since they knew no one would work under those old nasty NDAs and Non-competes. They knew that because people in CA and NY and TX had started making the non-existence of those documents a requirement of their employment. I actually saw a Non-non-compete one guy had. =) Warmed my heart. Later, before they ever made us sign anything, they fired me and paid me extra to not come back or talk to anyone there about what I did or consult for them for a whole year. I told the boss that fired us all, "pay me a bit more and I'll never talk to you again, promise!"

      --
      $you = new YOU;
      honk() if $you->love(perl)

Re: Headhunters and exclusivity clauses
by dws (Chancellor) on Jan 06, 2001 at 07:04 UTC
    Exclusivity clauses of the type eg mentions are common in Silicon Valley. From the agency's point of view, they're protecting the income stream they feel they're due after doing the upfront work of getting the gig set up. If you sign on full time with a client right after a, they lose.

    You can try to whittle the agency down to 6 months, or have them add a buyout clause, but some might not go for it. You can hope that if a company likes you enough, they'll cut a deal with the agency to spring you loose, but that might not work, either. (I just saw that happen.)

    Bottom line: This is one of the tradeoffs you'll have to factor into your decision to work through an agency.

Re: Headhunters and exclusivity clauses
by Blue (Hermit) on Jan 06, 2001 at 02:48 UTC
    I had a company (perm position, not consulting) that got all laywer happy. Over the two years I worked there I think there were 4 or 5 rounds of NDAs, each which superceeded the last. The NDAs had a lifespan of X years after leaving the company.

    There was also a professional conduct document, which included a "non-competing clause", that you couldn't do the same thing outside the company that the company did while you worked there.

    Then they combined them into one document. Which if you looked at it with a critical eye you agreed not to compete for the life of the document, which lasted for X years after you left the company.

    I (and several others) told them straight in the eye we weren't signing it. They told us that our continued employ at the company hinged on the documents being signed. I got out of there fast.

    Details may be hazy, it was a while ago, but it was just an ugly situation. Even if unenforcable, it was still something I wasn't willing to sign away.

    =Blue
    ...you might be eaten by a grue...

Re: Headhunters and exclusivity clauses
by coreolyn (Parson) on Jan 06, 2001 at 03:23 UTC

    I've got mixed feelings on this issue. For many years I always figured I could pimp myself as well as anyone else could and that the 'clauses' were outrageous. So I avoided such situations. Then hard times hit and I finally let one of the many knee-biters whore me out. Turned out to be the best thing I could have done. I'm now fully employed by an employer that wouldn't have even called me back for an interview, and at a pay scale that self-pimping would not have aquired.

    coreolyn
Re: Headhunters and exclusivity clauses
by jepri (Parson) on Jan 06, 2001 at 12:57 UTC
    The standard contract that I have signed with a well known (and multinational) agency states that I will not work on the same project for the same company but for a different agency for one year after terminating this agencies contract. This sounded pretty bad at the time, but I suppose it's fair.

    The 'company' I am working for can charge me with treason, throw me in jail and make me bankrupt for revealing anything I learn on the job. Beat that for a harsh contract.

    ____________________
    Jeremy
    I didn't believe in evil until I dated it.