In this chapter, we discuss the mechanics of restrictive covenants, post-termination obligations, and the issues involved in team moves.
Step 7: Consider covenants and post-termination obligations
While honoured more in the breach than in the observance, significant care is required to ensure that nothing in your move could give rise to a suggestion that you are either infringing on your restrictive covenants or your fiduciary duties as a partner. In general, leaving politely and on good terms without egregious fanfare or aggressively swiping half the practice and staff should be enough to avoid a threat of litigation.
There is an argument that if the firm you are leaving has a history of acquiring lateral partners and is aware that the joining partners are likely to have infringed on their covenants or duties in the preparation of their business cases, they should be precluded from litigating against departing partners who behave in the same way. This is not an argument that you really want to find yourself running!
Avoiding any form of argument is the goal and working with an experienced recruiter will help secure that outcome. At times seeking advice from an employment lawyer with substantial experience of post-termination obligations is a worthwhile exercise and this will, on occasions, be suggested and indeed funded by the firm you are joining.
Step 8: Understanding team moves
What “team move”? Other than with the consent and approval of the firm you are departing, this is a very dangerous manoeuvrer for an individual or even acquiring firm to pull off without repercussions. Even in the unlikely event that the partnership deed does not contain restrictive covenants expressly forbidding the poaching of staff, your fiduciary duties may well bite to prevent you from causing harm to the partnership you are / were part of.
While seldom litigated, the tort of induced breach of contract may give rise to a liability to you or to the acquiring firm if it can be established that you have exerted your influence over others to encourage them to breach their contract(s).
There is absolutely nothing wrong or actionable in a search firm independently headhunting several members of a department to fulfil a client’s desire to grow a particular practice area. This is what we do, and it is natural that we would seek to attract people who have a demonstrable history of working well together to work together in our client’s business.
Experienced clients and headhunters will never refer to a team move verbally or in correspondence: each hiring process will involve a unique approach to each individual and separate interview processes and offers. The result of a well-managed process may well look like a team move but on examination it will not be a partner leading other partners and associates to a new firm but rather several independent hires.
At the end of this masterclass, we are going to be sharing a business plan template that you can use to demonstrate your worth to your target firm. Keep an eye out for our business plan and feel free to contact us with any questions you may have.
