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I would like to hear from any of you who have or had their employees sign a non-compete/non-piracy agreement.
Have you had potential employees balk at this?
Also, I am in the business of graphic design currently looking for a new designer. I have had a number of designer applicants want to know if they can still freelance on the side. Since this is part of my main business, I am not thrilled with this idea.
I think these types of agreements work only if they are very reasonable. I think it`s fair to ask that employees don`t take your clients with them when they leave, and it`s fair to ask that they don`t steal or copy any of your intellectual property.
I think that asking that a person not work in the same industry or in the same geographical area for "x" number of years after they leave your company is not fair and difficult to enforce.
With regards to freelancing, I would think about establishing a program where your designers could bring their freelance projects into the company and work on them during their own time with your blessing. You would keep a small fee for handling the paperwork and billing, but let the designer earn the bulk of the profit. This would allow the designer to earn some extra money without guilt and allow you to keep tabs on what was going on.
My attorney feels that the not working in the same industry within x amount of miles should be in there. Whether it is enforceable or not is up to a judge.
Because I am training them is processes, information and knowledge that my competitors do not know (and there are some things that my competitors who are close are ignorant on ), allowing to take that information down the street to a competitor is just foolish.
I would have to think about that idea for the freelancer.
I certainly appreciate your desire to protect your knowledge. One of the risks of opening up your operation to outsiders is that they will learn some or all of your secrets. Once a person has learned something, it is impossible to get it out of their head.
But telling an employee that if things don`t work out at your company, he or she must pack up and move out of town in order to work at their chosen profession strikes many people as unreasonable. If this was a highly compensated sales or executive position you might be able to make a case for it, but trying to place such a restriction on the average working person (such as a designer) will be tough.
It`s hard to imagine a good candidate being willing to accept these conditions unless you were paying two or three times market rate. I think you may end up with people who are desparate for a job, or people who are willing to sign anything because they have no intention of honoring the agreement anyway.
I`m sure that your attorney knows more about this than I do, so please listen to him or her and not me. 
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