Lawmakers tout Amendment 1 as questions arise
by Jon Gillooly
jgillooly@mdjonline.com
October 06, 2010 04:26 PM | 2228 views | 2 2 comments | 10 10 recommendations | email to a friend | print
MARIETTA — The first of five proposed constitutional amendments on the Nov. 2 ballot is touted by state lawmakers as a change that would expand the rights of employees and employers in non-compete contracts. But not everyone is buying that pitch.

“We’ve actually got something on the ballot that says it’s to save kittens, but it’s really for killing kittens,” said Marietta lawyer Tom Cauthorn, a former Cobb Superior Court judge.

A non-compete contract is often used by companies hiring salespeople, or doctors in a medical partnership, or engineers. Such contracts typically stipulate that if the employee quits or is fired, he or she cannot do similar work in the same area for a specified number of years.

If the agreement is later taken to court, a judge can throw out the entire contract if one of those three areas in the contract — location, time limit or job description — is found unreasonable.

If voters approve the amendment, a judge would be able to preserve the overall contract by rewriting any portions found unreasonable.

“It’s bad public policy because it allows courts to basically redo an agreement to something that the parties did not agree to, in order so that it can be enforced,” Cauthorn said.

Rep. Kevin Levitas (D-Atlanta) was the first sponsor of Georgia House Resolution 178, which was used to draft the amendment. The resolution overwhelmingly passed both the House and the Senate last spring, and has the support of the Georgia Chamber of Commerce.

Levitas said he got the idea from a personal experience with his family’s chemical manufacturing business. A sales representative who signed an agreement with his company went on to work for a competitor in Ohio. When it came time to enforce the employment contract, the former employee resisted. But before it got to the point where it went to trial, which neither side wanted, they both went before an Ohio judge and let the judge determine what was reasonable. The matter was thus resolved amicably, he said.

Georgia, Levitas thought, needed to modernize its laws the same way.

Presently, anyone in Georgia can be asked by their employer to enter into a non-compete employment contract. Levitas’s proposal, however, would only impact about 10 percent of the workforce, applying only to key employees who have access to critical company information, he said.

Senate Majority Leader Chip Rogers (R-Woodstock) supports the amendment.

“Why should the government be involved in the private contract of two private entities where fraud or deception has not occurred? I stand by my support of the freedom to contract,” he said.

Rep. Rich Golick (R-Smyrna) also favors the amendment, which he says gives the business community peace of mind in knowing that it can better protect business information that an employee has pledged not to use.

But Golick also argues that the amendment, for the first time, allows a judge to determine if an agreement puts an undue burden on the worker.

“It actually affords more employee protection than currently exists,” Golick said. “There are a fair number of lawyers who make a living poking holes in employment agreements such as these, so their opposition and over-the-top rhetoric is understandable.”

The wording of the proposal on the ballot — “Shall the Constitution of Georgia be amended so as to make Georgia more economically competitive by authorizing legislation to uphold reasonable competitive agreements?” — is just plain dishonest, Cauthorn said.

“If you put that the reason for the amendment is to decrease competition, nobody is going to vote for that. If you put in there that the reason for it is to allow former employers to keep former employees from working where they want to, nobody is going to vote for that. So put on it that it’s to increase competition, and then everybody goes to the country club and talks to their buddies and says, ‘well, you know, I’m for private enterprise and competition and all that. I’m going to vote for Amendment 1.’”
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Cobb Attorney
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October 07, 2010
Tom Cauthorn is correct. It is deceptively worded. It does the opposite of what it says.The State of Massachusetts passed similar laws many years ago while California refused to. It had a real effect on the technogy business. In California Skilled Talent was able to leave established large Corportions and start new business in the same field. Technology grew in California and shrank in Massachusetts.
Angry Taxpayer
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October 07, 2010
Any five of the proposed constitutional amendments deserve to be voted down.....
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