When a Staff Member Leaves and Takes Clients

Source: Public Practice

The following includes excerpts from an article by consultant Marc Rosenberg, with input from Jennifer Wilson, Steve Weinstein, Bob Martin, August Aquila, and Rita Keller.

Here is what to do when managers resign and are expected to take clients:

1. Ask if they intend to take clients. They might not answer or they might lie. Observe their body language when you ask this question.
2. They should not be allowed to stay until their notice is up.
3. Change all passwords and office locks.
4. Make it very clear that you intend to aggressively enforce all terms of the non-compete, calling upon every legal tactic available under the letter of the law. This applies to clients, prospective clients and staff.
5. Consult your attorney. Taking your assets, including work papers and other information, may still be illegal, even if there is no non-compete agreement.
6. Contact clients immediately. Personally visit the bigger ones. Call the others. In your communications with clients, be aware that some clients might say: “A plague on both your houses—I’m going elsewhere.”
7. Consider taking a positive approach. Perhaps there are some small clients that you will waive any rights on if the managers agree to take them and not pursue the important clients. If they agree, this should be in writing.
8. Deliver an immediate communication in person to the staff expressing disappointment, but optimism, in the departure. Partners should not disparage departing persons. Wish them the best, but be clear that the firm intends to retain all clients and that steps are being taken to communicate with the clients. It will provide some great opportunities for the staff to “step up” and assume more responsibility.

For the complete article, click here.

From Texas Society of CPAs, Public Practice, February 2009, www.tscpa.org.