Employees often are a nonprofit’s greatest asset. Passionate for the cause, knowledgeable about the organization’s donors and operations, and promoting the mission with loyal dedication, they can be nothing short of invaluable. But what happens if an employee leaves a nonprofit, taking that knowledge and experience elsewhere – perhaps to another nonprofit with a similar mission focus and perhaps even competing financial sources and participant activities? May the first nonprofit employer prohibit the employee from “competing” as part of the person’s new work?
Many nonprofits use employee handbooks to serve the valuable functions of providing their employees with advance notice of work expectations, applicable requirements, and other responsibilities for a productive and mutually beneficial relationship. Such goals may likewise apply to volunteers serving nonprofits and even independent contractors, at least to a certain extent. Correspondingly, it may be helpful to maintain a supervisory handbook for more effective management of all workers - whether employees, volunteers, or contractors.
May employers prospectively restrict employees from “competing” – that is, from obtaining future employment that could harm their current employers - such as in terms of sales, market share, and other measurable organizational success? Less so now than before, per recent changes in Illinois employment law, as non-compete provisions must be carefully and narrowly circumscribed to be enforceable. Employers with employees in other states should note too the more generally applicable legal principles.