How enforceable is noncompete?

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Feb 3, 2009 2:28 pm

Well, I’m a recent Edward Jones cast-off.  Can-sell date of September 2008.

  After 4 months, I had +/-$250,000 in assets under management, but had upwards of $800,000 of assets identified and appointments made.   The only thing I didn't have was net commission standard, which was established well before the downturn in fall 2008.   I have a new Broker/Dealer interested in me, and several time-sensitive prospects.   However, as Jones terminated me, how enforceable is the non-compete (in other words, I acted in good faith in regards to the 3-year "pay your dues" timetable they ask for...but they ended my employment before I could)?  The way I read the wording is that I will never EVER be able to work in insurance and/or securities for the rest of my life, unless I'm willing to pay $75,000 to Jones.  It also seems to read that it wouldn't matter if I had these licenses before coming on-board...I'm still permanently out of the industry.   Has anyone had any experience in this matter?
Feb 3, 2009 3:54 pm

Consult an attorney.  But I can tell you, you are not banned from the industry.  And good luck to them enforcing a non-compete when they fired you after 4 months.  My guess - don't worry about it.  But consult an attorney.  And talk to counsel at your new BD.

Feb 5, 2009 4:41 pm
Congratulations!!!  You don't work for some scam from home work scheme.  I  know, you probably didn't even get into an office yet, did you.  I bet you got to watch many who did get an office, after the poor fellow before them slid down the slippery wall they were thrown up against.  Yeah, and all the while the Regional Leader kept pointing the finger and asking the rest of you why your numbers weren't as good as that smuck that inherited 7.5Mil AUM in A shares and muni bonds...right?    I'm surprised you don't already know more people who used to work at EDJ than currently do.  Jones is like a revolving door.    I have never heard of a single instance where that contract was enforced if they let you go.  In fact, there were actually people in my class that got their 7 and then didn't do anything so they could get fired and go to work at a bank.  I would consult with an attorney, just to be safe, but I have never ever heard of one of those contracts coming back to haunt you IF THEY FIRED YOU.   When I left Eddie Jones, my firm paid that amount for me, but I left Jones, and went to a competitor.  Totally different situation than yours.   Your better off without Eddie Jones.   My damn feet hurt, ED
Feb 5, 2009 5:16 pm

You are fine… they fired you…6 people did it on purpose in my class so they could leave… You will get a letter registered mail from the Law firm they own, that will show you your contract that you signed and how you “can’t” solicit clients for 1 year…

  Go and be free... but it's still about the contacts.. what are you doing that works?
Feb 6, 2009 11:13 am

IMHO,

If you couldnt make it at Jones, seek another industry...something more recession/depression resistant.   Jones quotas are some of the lowest in  the industry
Feb 6, 2009 9:53 pm

Just because he couldn’t make it at Jones, doesn’t mean he should leave the industry. I know quite a few people who were sucking it at Eddie J, and now are doing quite well for themselves, either at the bank or indy. You just have to have a certain personality at Jones… and you have to BELIEVE that the crap they are spewing at you is true.



Nothing like blind faith to ruin a marriage and starve your family!

Feb 6, 2009 10:02 pm

Clang - in all seriousness, Jones can either be magnanimous or vindictive. It’s really quite interesting. I would almost think the big green machine were alive and bipolar.



When I left Jones, I got a couple of letters from some law firm telling me that I couldn’t solicit their clients (along with a copy of the contract) and they told me to take the files I stole back to my old office and they also said that I wasn’t registered, so it was illegal for me to even talk to them - interestingly enough. I almost believed them and had to double check with the SEC and NASD. That would have been embarassing!



Anyway. Be careful, but do what you have to. Times are tough. You need to do what you can to put food on the table - screw them.

Feb 7, 2009 12:50 am

[quote=clang664]Well, I’m a recent Edward Jones cast-off.  Can-sell date of September 2008.

  After 4 months, I had +/-$250,000 in assets under management, but had upwards of $800,000 of assets identified and appointments made.   The only thing I didn't have was net commission standard, which was established well before the downturn in fall 2008.   I have a new Broker/Dealer interested in me, and several time-sensitive prospects.   However, as Jones terminated me, how enforceable is the non-compete (in other words, I acted in good faith in regards to the 3-year "pay your dues" timetable they ask for...but they ended my employment before I could)?  The way I read the wording is that I will never EVER be able to work in insurance and/or securities for the rest of my life, unless I'm willing to pay $75,000 to Jones.  It also seems to read that it wouldn't matter if I had these licenses before coming on-board...I'm still permanently out of the industry.   Has anyone had any experience in this matter?[/quote] What are you seriously worried about a noncompete over 250K in assets???? Wow!!
Feb 7, 2009 1:38 pm

icecold,

I see you've read alot of my posts.   You even called me helpful.  Yes the clocks still ticking. Good luck  lil' rookie.   PM me if you have any further comments or questions     For the others, please read my posts from the past 2 years if you have any interest in icecold's statements   One final word of advice for ice.  For a kid with about a year of industry experience:     Get out, get productive, quit playing on this forum..over 2000 posts.  Get a life.  You are done here.
Feb 8, 2009 12:43 am

I think you are in good shape, but I agree you should talk to an attorney. Not the general practice guy either. You need to talk to an attorney specializing in the securities industry. If they (Jones) hasn’t already hit you with a TRO (temporary restraining order) you are probably ok. Also, as someone else mentioned, the BD that is recruiting you should supply with some legal advice. Good Luck!