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Employer rights and trade secrets

Your employer has the right to stop you from using the company's confidential information - often called "trade secrets". In labor law, trade secrets are things that you know about only because you worked for the employer. For example, if you work for a restaurant that has a "secret recipe," you can't use that recipe in your own restaurant if you know that it's a secret. For information to be a "trade secret," your employer must make sure that the information doesn't become generally available to the public.

Employer rights and solicitation of employer's customers

You can't try to take away your employer's customers while you are still on the job. For example, you shouldn't write to your employer's customers before you leave and say something like "Hey, I'm starting my own business and I'm going to be better than my old employer".

And even after you leave your current job, your former employer can usually stop you from opening your own company and luring away former customers by using your former employer's confidential customer lists. However, it's usually OK if you leave your former employer and your old customers come to you voluntarily.

Employer rights and solicitation of employer's workers

You're not supposed to lure away co-workers to your future company while you are still working for your employer. For example, you shouldn't approach those co-employees on the job by saying something like "I'm starting my own business. Come and work with me there because it will be better than here."

And even after you leave your current job, your former employer still might be able to stop you from opening your own company and luring away your former co-workers. Whether such "poaching" is legal depends on the state you are in and on whether your employment agreement restricts you from employing your former co-workers. However, it's usually OK if you leave your former employer and your former co-workers come to you voluntarily.