Experienced Scrapper
Do you ever get a slight feeling of nervousness that one of your employees will strike out on their own and take customers/accounts from you? I get paranoid about that sort of thing, that's why I've only ever hired one person, a college kid that needed some part-time work.Originally Posted by StRegis
Probably silly to think like that though...
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That's why they make non-compete contracts. But don't try to do this on your own. Have a lawyer draw one up or you could wind up getting the contract thrown out in court.
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Unfortunately (well depending on which end of it you are on), non competes are basically worthless. They are difficult at BEST to enforce and that typically is a trip to court. Generally, you can't force someone to not be able to work with the skills they have. At least this is true in the US. These typically serve as a deterrent only for those unaware of the general courts viewpoints on that. About the only time they are enforceable is when trade secrets for a business are involved.
There really is only so much you can do with employees. They can leave at any time and take what they have learned with them. The best way to hedge is to keep most of the important info to yourself AND to provide EXCELLENT customer service along with the best prices you can. In the end, it is the relationship that helps keep clients.
Just an observation from of course. I just know that non competes are kinda like the signs in the parking lot that says they aren't responsible for buggy damage to your car....sounds legal and look intimidating, but doesn't hold water if you actually go to court.
PROFIT is made when you BUY/ACQUIRE NOT when you sell
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From Wikipedia:
The majority of U.S. states recognize and enforce various forms of non-compete agreements. A few states, such as California, totally ban or prohibit non-compete agreements except in limited circumstances.
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That just is not generally the way it happens in most places if something ACTUALLY makes it to court. Judges have consistently not allowed people to restrict people from working in their industries. Again, there are exceptions, like higher level executives with trade secrets and insider info, but for the average person, it just isn't something they enforce easily. Again, you ACTUALLY have to drag someone into court and get an injunction, THEN have a trial and get the ruling. This is just not something most people will do or have the means to do. Further, damaging someone by refusing to allow them to work just doesn't happen very often as it is GROSSLY unfair and harmful to the individual...most of these "contracts" get thrown out. Wikipedia is nice and all, but use it sparingly and certainly do not take it as the truth in matters (I mean anyone can edit it, so...).
I personally would tell someone with a non compete (and I have signed them, laughing as I did so, knowing they couldn't enforce it) to go pound sand...I would see them in court. Again it is like the buggy thing I mentioned...most companies say they are not responsible, but in reality it was there to scare me as a consumer. I personally have collected from a buggy hitting my vehicle with very little issues (so shows you how much BS those signs are).
Again, this is in the US...I have no knowledge of countries outside the US in terms of these laws, so YMMV if that describes your situation.
Experienced Scrapper
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I wanted to reply to RagnBone on employees stealing customers. After a week on vacation with my employee filling-in for me, I'm happy to report that my employee still works with me and all my customers are still there. I don't get this uneasy feeling of poaching for two main reasons. First, there is so much cardboard out there that I doubt I have even 2 percent of the market in Philly. There is no need to steal my customers because there is so much fiber out there that anyone can collect thousands of tons. The only problem for any potential competitors is what are they going to do once they collect that cardboard? They need the equipment to bale and transport that fiber in order to get a fair price and that equipment don't come cheap. They could sell to another paper broker but they won't have the volume to get a good price (probably $50/ton or less). Second, I think I treat my employees pretty well. I think I pay them an above average wage and that should buy some loyalty. Also, the two guys I have are hard workers but they're not the type that are planning to start their own business. If they started asking about my buyer, profits per ton or other details on the business, I would get concerned. But we usually talk about how horrible the Sixers are or how the Eagles will disappoint us. My newest employee did ask if I would buy fiber that he collected on the side after work and I just told him that I didn't want to do that because I couldn't tell what he collected on the job or off. He didn't push much after that. I think he just needed some more money and full-time work.
Experienced Scrapper
Well that's good to hear, StRegis. If there's one thing America has enough of, it's cardboard.
I just wish the Styrofoam pieces you get in every power tool package were worth their weight in gold.
Much like a hobo might daydream about box cars overflowing with fine wine and finer women, I like to daydream about being a Styrofoam scrapper, wealthy beyond his wildest dreams.
No more back pain for me...
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The trick is to pay them well and treat them right so they will not want to leave. Sure, it may still happen on occasion but mostly folks prefer to avoid the hassles of ownership if they can make a living as an employee. A non-compete can help but you have to have the cash to enforce it and even still, there are ways to get around it. Take care of your people and they will be loyal.
Have Fun,
Harold
I hate rules, but I love junk.
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