On Media: Sitting out non-competes

Feb 5, 2008 at 10:09 pm

If you think you’re good enough at your job to earn a higher salary and better working conditions at a competitor’s business, in most walks of life, it’s not that hard to do. Risky, maybe, but in most cases you won’t end up in court.

If you’re a local TV reporter, however, you better check your contract. Non-compete clauses in employment are enforceable in Kentucky, in many industries, and are standard in the broadcast industry. That’s why it’s rare to see a reporter leave a station and start work at another in the same market.

The few individuals who pull off a station change may have to remain off the air for a year, giving rise to the term “sitting out a non-compete.” The logic goes that if a station invests time and money in promoting someone with talent on the air, it’s unfair to the station to have the reporter walk across the street and start competing against it.

But many in the industry argue against non-competes as being unfair to individuals, often forcing them to change careers or move. States like Arizona, Illinois and Maine have passed legislation limiting the power of non-competes. But in Kentucky, even if you’re fired from a station, the pacts can keep you from working in the market.

“They’re more difficult to enforce if you fire them, or if you had inappropriate contact in some way,” says noted media attorney Jon Fleischaker. “But everybody signs them, and, in Kentucky, they’re enforceable.”

The fact is that the supply of young and hungry broadcast talent exceeds demand, and the clauses have become an accepted part of doing business. They’re nothing new. And while several of the people interviewed for this piece compared the plight of reporters to “indentured servants,” non-competes aren’t going anywhere in Kentucky.

There are exceptions. Recently Bill Alexander, an 11-year veteran of the market at WLKY-TV, left and landed at WDRB-TV within a week. WDRB’s Derek Scott was canned there and has been doing freelance reporting at WHAS-TV. It happens all the time, but only as a result of negotiations involving the non-compete.

“Generally, all non-competes will be enforced,” says WHAS G.M. Mark Pimentel, a former reporter. “I’ve been on both ends, but I have seen them enforced no matter the circumstances.”

Including when the station does the firing? Legally, and principally, Pimentel says yes.
While he wouldn’t comment on individual cases, the station’s non-compete enforcement threat has kept former reporter Sean Bartel from working in the market, even though WHAS let him go. He’s seeking jobs in other markets, though without a non-compete he likely would have found work at a local station.

It’s that sort of worst-case scenario that prompted more than 80 local broadcasters to back legislation in the Kentucky legislature two years ago prohibiting enforcement of non-competes. The bill died in committee.

Pimentel says the non-competes are simply the way the business works. WAVE-TV G.M. Steve Langford sees it differently.

While Langford defends the use of non-competes in the industry, he says that if his station makes a decision to let someone go, it will not enforce a non-compete.

“If a station says you’re not in our plans, go on and do what you want,” says Langford, who helped write a Kentucky Broadcasters Association resolution that says if an employee is terminated without cause, the non-compete would no longer be valid. For example, he said WAVE didn’t stand in the way when Tony Hyatt (now the Metro Council’s Democratic Caucus spokesperson) left WAVE for a new job at WHAS.

What actually occurs in Louisville often serves mainly to keep salaries down. Since a new contract usually means a salary increase, some stations simply allow the talent’s contract to expire and agree to continue employment at the same rate. Some reporters go years without signing a new contract, but the non-compete is still in effect the day they walk out the door.

Sometimes, there’s a way around the contract stipulation. Such was the case with Barry Bernson, who left WHAS in 2003 and was able to move into the morning anchor chair at WDRB the next month. Why? In an e-mail, then-G.M. Bob Klingel wrote to Bernson telling him that his contract wasn’t being renewed, but that he’d be able to continue at his then-current salary, while all other provisions of his contract were null and void, including the non-compete.

Stations have a right to protect themselves from losing talented personnel, especially those in whom they’ve invested resources and promoted. But too often the non-compete clauses are used as a weapon to suppress salaries or simply to spitefully keep a fired employee from working in the market.

Rick Redding, Louisville’s Media Critic, writes frequently about news and media on his blog, http://thevillevoice.com