“How should an employer treat an employee who works for a competitor?”

Question: Hi, Alan. I have an employee working for me as a gymnasium instructor between 15 and 30 hours per week as required by the business, on a casual basis, without a written contract, for the last four months. He is always available as I require when I give him one week’s notice.

I have now discovered that when he is not working for me, he works on a casual basis for a company in direct competition to me.

What are your thoughts on this? Best regards. 

Waterford, Ireland

Answer: Dear Seamus: As you might know, I usually do not give advice, counsel or suggestions to employers, but your note encouraged me to make an exception.     

1. If your employee does good work, and meets your needs, you would likely want to retain him. More and more, employers are coming to understand that their business success requires that they hire and retain the better – if not best – employees. From your letter, you seem happy with your employee, and from how you have described him, he seems to be a good performer, flexible, and conscientious. What more could you want?

2. If you want a “commitment” from your employee, you have to give a “commitment” to him. I hope you don’t feel that your employee has been “disloyal” to you or your company because, when you don’t give him hours to work, he gets hours to work from your competitor. “Commitments” run both ways: you generally do not get them unless you give them, as well. 

3. Since your competition also seems to find your employee to be helpful to its business, it seems that the two companies may well be – or become – in competition for the employee’s services, too. I’d say that not only are you and your competitor in competition for customers, but you are also in competition for those employees who help you attract and retain customers. At the present time, everyone seems comfortable with the flexible arrangements, but chances are, sooner or later, someone will want more hours or different shifts that will likely upset the present comfortable arrangement. When that happens, you might just lose a valuable employee.

Don’t forget: if he is good with customers, and you either fire him for alleged disloyalty, or do not treat him well, then when and where he goes, his customers may follow him, perhaps right into your competitor’s gymnasium.

4. You might try demanding he sign a non-compete agreement, but I doubt that will work. My experience leads me to expect that most employers in your shoes would be tempted to insist that the employee sign a non-compete agreement, in this way locking him away from working for your competitor. Non-compete agreements rarely work, often backfire, and might just drive your good employee to quit and go to work for your competitor.

5. My suggestion: Treat him better than anyone else would – especially your competitor – and chances are you will keep him, and get the best from him, including loyalty. There is an old saying, “Pay peanuts and you will only hire monkeys.” In life, in business, and in the workplace, you can pretty much count on one thing: you get back what you give.  

In sum, Seamus, a good employee is hard to find, and harder to keep. Ask your good employee what motivates him, and then go about motivating his good performance, his good attitude, his flexibility, and his loyalty. Those are my thoughts. I hope you will give them consideration.

And, thank you, for writing in from Ireland.

My Best,
Al Sklover

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P.S.: If you would like to speak with me directly about this or other workplace-related subjects, I am available for 30-minute, 60-minute, or 120-minute telephone consultations. (Even 5-minute “Just One Question” calls). Just [click here.] Evenings and weekends can be accommodated.

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© 2012 Alan L. Sklover, All Rights Reserved.


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