Archive for April, 2012
In addition to the potential violations of confidentiality and non-disparagement provisions contemplated by a “tell-all” book about Goldman Sachs, Greg Smith should also consider garden leave and/or non- competition/non-solicitation restrictions. If Smith had a new job lined up before resigning, did he make the new employer aware of the restrictions to which he was bound? If these post-employment restrictions are reasonable in scope and duration, and protect Goldman’s legitimate interests, Smith (and possibly his new employer) will need to be mindful of not overstepping the boundaries of the restrictions.
In “On the Hunt for Tech Hires“ in The Wall Street Journal (April 11, 2012), Lauren Weber writes that technology companies, outside of the “Silicon Valley [stars] or hot start-ups,” are wooing tech professionals with perquisites and benefits. A sense of creativity has found its way into the recruitment process. Food truck treats, gifts (such as radio controlled miniature helicopters and personalized items), plus personal attention at conferences and events, are part of the program to attract “techies.” However, it appears that industries are going outside of the typical HR processes only to the extent they need to attract the best talent. The tech industry is different from the apparent trends found in the job market generally. To the extent an industry needs new talent and the competition for such talent increases, more perqs and “romancing” of applicants becomes part of the application and hiring process. It might also be worth noting that a similar creativity in recruiting was first seen in the dot-com bubble in the late 1990s, when companies sold the perqs of working for them to win the best talent. One can only hope that this is not a bad omen.
It appears that the trustee in bankruptcy is considering bringing suit against former executives of failed MF Global for “breach of fiduciary duties.” News reports indicate that there are insurance policies in place that will provide coverage for the executives for their “wrongful act” legal defense fees. While the author is not opining on the actions of the MF Global executives, the issue illustrates the significance for C-suite executives to obtain maximum indemnification coverage, not only as provided under a company’s bylaws, but also under insurance policies of indemnification (referred to as “errors and omissions” or “directors and officers” insurance policies). It will be interesting to see whether the causes of actions enumerated in the pleadings will be subject to the coverage in the policies or whether there will be coverage disputes ensuing.