When your best employees leave, they don’t just take their skills and training with them; they also take the knowledge and contacts they’ve gained on the job. This can pose a threat to your business goals, especially if their new role involves competing or negotiating with your company.
For employers of highly-skilled talent, the urge to keep trade secrets from walking out the door— and into competitors’ offices— is understandable. That’s why some companies choose to institute non-compete clauses (NCCs) as a condition of employment.
When legal conflicts arise between employees and employers — such as misconduct or a breach of contract — they’re generally settled one of two ways: via lawsuit or arbitration.
And because lawsuits can be lengthy and exhausting for both parties, many employers prefer to resolve disputes through arbitration. Plus, preventing lawsuits can help a company protect its public brand identity.
However, as organizations like Google have recently discovered, forcing arbitration can jeopardize an employer’s reputation and undermine employee trust.
Here are several things you need to keep in mind when deciding whether or not to include an arbitration clause in your employee contracts.