The Non-Compete Clause I Stopped Using

Three years ago, every offer letter we sent had a two-year non-compete stapled to it. I pulled it out of our template in 2024 and haven't looked back. The clause was doing nothing useful and quietly costing us candidates.

What the non-compete was actually accomplishing

Nothing I could measure. In seven years, we've had two employees leave for a competitor. Neither time did I call an attorney. Once, because the person was junior and the risk was rounding-error. The second time, because the client relationship belonged to us, not to her, and she knew it. The clause sat in a PDF in a shared drive. It wasn't protecting anything.

What it was doing: scaring off two senior candidates I wanted. Both asked, politely, whether the non-compete would follow them if we didn't work out. One took a job elsewhere. The regulatory picture on non-competes has also gotten messier state by state, and I'd rather not fight that battle for a document that wasn't earning its keep. Talk to your attorney about your state — this is not legal advice, it's what I decided for our shop.

What I replaced it with

Two documents, both narrower and both enforceable in ways a blanket non-compete usually isn't.

• A confidentiality agreement that names the specific things we consider confidential: client lists, pricing, our internal SOPs, anything a client shared with us under NDA. Not "all business information," which courts squint at. Named categories.
• A non-solicitation clause, 12 months, that says if you leave you don't actively pitch our clients or poach our staff. Not "can never work with anyone we've ever met." Actively solicit.

Both are shorter than the old non-compete. Both are things I'd actually enforce, which is the only test that matters. A clause you'd never take to court is a clause that isn't protecting you — it's decorating the offer letter.

The trust piece nobody writes about

I hire adults. When someone leaves us, I assume they're going to keep working in the field they've built a career in, because of course they are. Trying to lock that down with a two-year cage was never going to work, and honestly, it sent the wrong signal on day one. The offer letter is the first real document a new hire reads about how we treat people. If it opens with "and here's what you can't do for 24 months after we part ways," I've already told them something I didn't mean to say.

The new version says: here's what's ours, here's the line, otherwise good luck. That's the deal I actually want.

If you're cleaning up your offer letter template and the non-compete section is giving you pause, send us a note — this is exactly the kind of small-shop paperwork tune-up we like helping with.

— Amanda @ SBATC