ethics question

So, I'm a part time CNC machinist at a local repetitive job shop. Not just a button pusher. I design and build fixtures, do a ton of programming, QC, first part inspection...etc. As of the last month, stuff has been slowing down. Overtime was eliminated...last year I was layed off about this time. They don't lay off full time employees, but I'm only working 30 hours a week while I finish up school. They really want me when I graduate...they likely won't get me as I'm a manufacturing engineering major, and they want me as a machinist, but if they lay me off, I have a choice to make.

I just purchased a nice Deckel FP4A awhile back. When we are slow at work we do a lot of little one and two part orders for companies that we often do larger orders for. I know for a fact that one company right now has sent a pile of prints for these small part orders. If I get layed off, would it be unethical to contact this company, explain that I have extensive experience machining their parts, and tell them I'm a small shop just starting up, and would be interested in quoting any small part orders they have? I can certainly underbid my current employer being that my overhead is so much less.

Any opinions on this would be appreciated. The owner of the shop I'm currently at is interested solely in the bottom line. He is not a machinist, and has almost no knowledge of machining. The only reason they don't lay off full time employees is because that was the policy when the current owners father owned and ran the business.

First, how will your present employeer react to finding out you hunted down an existing customer? Chances are they will find out. Then how good of a reference will they be for you when you go job hunting with your new degree? I am disappointed you even entertained the thought.

Read Jackal's post "Any one ever demand to know your customer before they can start a job?". You are aligning yourself with the shop wanting to swipe Jackal's customer.

I would ask myself "Would I want my own employee doing that to me?"

Only if you get laid off permenantly and don't want to, can't ever see yourself going back, otherwise you are playing with fire.
Even if you are no longer working for that company you are going to have to be very careful.

Would it be unethical to contact someone, considering that you have inside knowledge and contact info? Yes.

Is your boss an unethical Hun and is it a matter of survival? Then maybe it's OK in the grand scheme of survival of the fittest. Beware of legal ramifications if you've signed anything. Or if you ever need a reference.

If you hunt down lists of companies and start calling everyone on earth and just happen to stumble upon that company in a legitimate search for work, then it's OK. You would have found them despite your employment.

Also, think about the company or companies you would contact. If they know you are doing this, would you trust them in the future, or would they trust you? What of you fail to deliver? Would they be cutting off their backup plan?

Take the above with a grain of salt. I'm just a salesman...

I'm not necessarily looking to underbid my employer, I know there are a lot of these parts they won't get because a smaller shop will underbid them. A lot of reputable companies will not give out the names of companies they are contracting to make parts. I don't really want to take parts from them, I just know this company would be a good place to look for small order high paying mill work.

In all honesty, the people there that know my capabilities won't be the ones writing the letter of reference anyway, so I don't know that I'd ever ask for one from them. If the current owner wrote it, it would probably sound idiotic, as he doesn't really know the extent of what I do there anyway.

"Would I want my own employee doing that to me?" As far as engineering ethics, we live in a capitalist country. If someone thinks they can start their own shop and be more productive/efficient/whatever, that is there choice. No company is ever going to be happy about competition.

I wouldn't feel good about doing this, but I also won't feel very good about being laid off from a part time job where I do 20.00/hr. work for 13.00/hr. I'm hoping I don't get laid off, and this isn't necessarily my plan. This is just a question. Thanks for the responses.

If you signed any kind of employment agreement you need to read it very carfully. It may actually be illegal for you to contact any of your present employers customers. As far as ethics the easy answer is (IMO) it's wrong to take any of your employers customers or work. The loss of any job affects everyone that works for that company. You may not like your boss but are you willing to take money away from the guys that work out in the shop? Would they lose their OT ? Could some of them lose their jobs?

That being said my guess is a good many start up businesses are the result of an employee deciding he can do a job for a customer for less money and make more money for himself. I was there myself once with a fellow employee but I backed out of the deal because of ethical concerns.

A couple of things to consider. If the owner has more work than he can handle ask him to farm some if it out to you (you already have decided not to stay there long term). You may be able to contact the customer and ask if there are any jobs you can bid on not going to your present employer.

One last thing. Be prepared for the customer to blow the whistle on you. Loyality is still very important to some.

Cross Hair

In the engineering profession it's common practice to include a "non-compete" or "hold-off" clause in all employment and consulting agreements. The clause prevents the individual from engaging in work for the company's customers for a period of time, typically six months, after the contract is completed.

While I realize your question doesn't relate to the engineering field directly, you might find this to be reasonable guidance.

- Leigh

Did you sign a noncompete agreement when you were hired?

Have you considered going to your present employer and
broaching the subject with them?

It's a big bad world out there and your employer would
have no hesitation in throwing you under the bus if they
could make a buck on the deal. But as others have said
it's a small world and ask yourself, if you were them,
would you want you doing what you propose?

Jim

cross hair said:

You may be able to contact the customer and ask if there are any jobs you can bid on not going to your present employer.

Click to expand...

Or, you might just ask your present employer if it would be o.k. with him if you contacted the customer in regards to some of the smaller jobs. It's possible that he has no interest in doing one-offs, preferring to focus on production work.

When I left one shop to go to work for another, I did not seek out any of the previous shop's customers. There were a few customers who followed me. One told me that "David has always done my machine work, and I want him to continue doing my machine work." To me, there was nothing unethical there. In fact, the owner of the former shop is one of my customers to this day. (He prefers to sub out certain jobs rather than keeping them in house.)

It's always been my policy to not burn bridges when possible, and leave on amiable terms. Giving 2 weeks notice allowing a guy to find someone else to replace me would be one example. You never know where your next good subcontractor or customer will be found.

If you want to start you own thing on the side but don't see it as a full time thing(mostly if you want to work as an ME), try to find your own costumers or your own product. Note that whoever you do work for, is or was getting work done by somebody else anyway, you just may not know them yet. Which brings the point that if you were to do work for that same customer, you could look or ask for parts that aren't being made by your current employer, but not every employer will see that far into it so it may still be safer to look for something else.

You have to eat and pay your bills too...
When you get laid off they will say that it is for lack of work, right? RIGHT??

Here is what I would do if I were in your shoes:

After your lay-off notice from xyz co. draft a letter with the theme as follows:

Mr Jones, President.
abc co.
anytown
state

Dear Mr Jones,

I am an experienced machinist with x number of years of varied experience, and working towards my degree in...

Recently I was laid-off at xyz co. for lack of work.

Having now opened my own shop I would be pleased to quote on any work such as prototyping, experimental, small production runs etc. that xyz co. has turned down.

Thank you very much for your consideration.

Yours very truly,

(signed)

Joe Blowe,


Cc.: Mr. Smith, President, xyz co.



Run this letter past your current president AFTER you got your lay-off notice. You might be surprised at what could happen. This of course assumes that you did not sign a non-competition agreement which, BTW is exceedingly rare among blue collar shop workers.

Good Luck!

"Nothing personal, its only business."

Arminius

If I get layed off, would it be unethical to contact this company, explain that I have extensive experience machining their parts, and tell them I'm a small shop just starting up, and would be interested in quoting any small part orders they have?

Click to expand...

Unethical?
Technically yes.........
Would you be the first one to do this?

Free trade, land of opportunity.......the good ole USA.

Does big business think twice about shipping jobs to China,closing down plants, and putting hundreds of their loyal employees out on the street?
I suspect things are going to get way more ugly before we see any silver lining here. Could be a mans gotta do what a mans gotta do to survive at some point.

Also possible when the "current owners father" started the place HE acquired some customers from HIS former employer....this has all been going around for at least 100 years...
I personally would mention to current employer that you are in need of income and would like to do some of the work you are thinking about. See what reaction you get. Be prepared to get let go in the process, and because of that, only do it when you're ready for the worst case scenario.

Just lately, I have a 130 person Job Shop that I would like to do machine work for.
They want me to sign a NCA that is worded in a way that basically gives them the power to stop me from doing work from any of their present and future customers. They claim "that's not what the intent is, we just don't want you stealing our customers". My response was "unfortunately your -intent- isn't described in the words in this document, but your legal rights are". So I wrote an addendum that basically said I wouldn't go directly after the work that they give me to do from any of their customers, but I have the right to seek out new clients and new work from anyone I choose. Well, they "don't like" the way that sounds either. So I suggested we both sign the NCA, one with them named as 'company' and me as 'vendor' and another one with the names transposed.
Fair is fair .....Right?
Nope....don't want to do that either.....
Two sets of rules.......theirs and everybody else's.
Another problem is, we have mutual customers right now. So legally they -could- stop me from doing that work also if they choose to and IF I signed on the dotted line.

I even got a talk about 'not stealing employees'....they have had problems with that in the past.
Funny tho.......I'd guess at -least- 80% of their employees have been acquired from other places via 'lucrative offers'. Is this a nice way of saying "stealing"....???

People are funny......almost seems a bit sleazy huh?

*IF* you're laid off, why not approach the person with decision making power (the owner or your supervisor) about doing contract work for your current employer. Mention that you have a mill at home and have been doing some work on your own and wondered if they'd like to become a customer. They may take you up on your offer. Then you don't have to worry about any ethical problems. If they decline, you've given them fair notice, albeit indirectly, that you may be competing with them for small jobs. After that, contact several potential customers, not just the one that submitted the most business to your current employer or ones you've seen your employer dealing with. As advertising, it's fair to note your experience with your former employer. Let those customers connect the dots regarding whether you may have done some of their previous one-off projects. If they ask whether you did any of their projects tell them about it. If you contact multiple potential clients, and not just your current employer's good customers, they have nothing to complain about unless you've signed a non-compete agreement. Competition is part of business. I dont' like to see competition, but I've got to live with it. It's life. Now if I were in the hypothetical situation where somebody on the inside targeted my customers, I may not be able to do anything about it legally, but if I ever had the opportunity to hurt their business prospects - turnabout is fair play. Done correctly, they may grumble, but can only respect your gumption. Done as a slap in their face, and you'll make an enemy. Each business has its own customs, so my perspective is from outside the machinists trade.

David Carlisi said:

It's always been my policy to not burn bridges when possible, and leave on amiable terms. Giving 2 weeks notice allowing a guy to find someone else to replace me would be one example. You never know where your next good subcontractor or customer will be found.

Click to expand...

I will agree that it is best to give 2 weeks notice and not burn bridges, but this is a two way street and I have been burnt more often than not with giving notice.

I don't agree that anyone should go directly after your present emloyers customers. It would be better to start looking around for work, start your business and then if you are laid off give it a month or so to find out if there is any intent to go back to work or for them to call you back. If after weighing things out, letting them develop you still have room to do work for this customer go after them and explain that you are looking fo the smaller volume work.

If they lay you off what are you supposed to do? If they don't have a non-compete agreement, then I would have no guilt doing work for that customer. Employers have screwed employees in every way possible. I would contract with that company, and I would not spread the news. You have to realize, in todays world, you are merely a number. Retirement is a thing of the past. If you are no longer an employee for your company there really is no conflict of interest. Don't feel sorry for your employer. No telling what kind of unethical things they do to get jobs.

I'd have to say it depends on the current relationship your employer has with this customer. If its there main customer that keeps supper on all the other employees table then I'd stay away. If its a customer that has several job shops in the area doing work for them, then I don't see a big deal with it as long as your not going through your current employers contacts, you probably would get busted. Don't tell them you can underbid your current employers prices. Just let them know you have a shop, what work you can do and you'd like the opportunity to bid on some work. I'm in the same situation and don't pay any attention to any of my current employers contacts. I try to be open about my shop and stay on good terms with my boss. Just last week it has paid off he trusted me enough to send a job home with me over the weekend. All his machines were tied up and he needed it Monday mornin 8:00. I'd like to do this more in the future and in the mean time I'll work on my own list of contacts, without being sneaky. It also depends on the terms you and your employer are on. I've had bosses I wouldn't hesitate going for any of there customers but only after being employed by them.

Listen to your heart

I agree with many of the others - check your employment agreement very carefully. It may even be worth your time to take it to a lawyer. A few hundred bucks now is a lot cheaper than many thousand down the road if (when) they sue you.

If all is good, send out letters to as many potential new (to you) customers as you can think of - the more the better. Keep a copy of the letter in the potential customers' file. (It could be purely coincidence if one or more of your former bosses customers is in the list.)

This way, if anything happens down the road and your former boss comes after you, you can show that you weren't targeting his customers, you sent out many letters.

Andrew

Lots of great thoughts here. Thanks guys.

The first thing is, no one there is at risk of losing hours or their job because of whatever I may do. The overtime mostly applies to deburring and rush jobs. I've never signed any sort of agreement, so that is N/A in this situation. This is indeed ONLY if I get laid off. I'm not going to quit and pursue this. I have loyalty to my employer so long as they keep me employed. As things stand right now, they by far get the better end of the deal. I'm a better machinist than many there, have the perspective of a machinist, engineer, and businessman. I have more schooling than anyone else working out on the floor, and half of the management.

I like the idea of a waiting period. While they would have the intent of hiring me back when work picks up, they have no way of guaranteeing when that may be. I also have a family and have to put food on the table and gas in my vehicles.

Your the reason my machinists never see who the work is coming from. All the prints are blacked out or cut off. Flame away

Jay
www.CandLMachine.com