Non Compete Contract

Old Jan 30th 2006, 3:48 pm
  #1  
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Default Non Compete Contract

Hi Everyone

I have been working in the US for an small IT support company for the last 2 and a half years. I am a permanent resident.

I have been told that I must sign a non compete form or I will be dismissed. I have also been told that I am doing a great job and my boss has no complaints with the work I do.

This all came about because another technician went to work for one of our clients. The client then cancelled their support contract with us.

I refused to sign the contract stating that this should have been done when I joined the company and that I should receive some sort of incentive to sign it.The contract was completely unfair as you can see below.

I ............ being employed by ......... Computer Services, Inc. agree that I will not take the offer of employment (involving the scope of duties integral to my current position of a netwrok systems technician) from any client of said comapany for a period of two years post termination and/or geographic vicinity of a 30 mile radius of said company's ........... location.
The same restrictions follow regarding self-employment and solicitation of .........'s clients.

I sat and spoke with my employer and he agreed that the contract was unfair and that he would rewrite it. He also stated that my incentive for signing would be "continued employment". I would have to sign one or be dismissed. I am currently waiting for the next contract.

If I am dismissed will I be able to collect unemployment from him? and do I have a good case for unfair dismissal?

Should I call his bluff and refuse to sign one at all? I'm sure business will be hurt if I leave.

I understand that I will be receiving your personal opinions, advice and experiences and not legal advice.

Thanks

Gripper
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Old Jan 31st 2006, 9:31 am
  #2  
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Default Re: Non Compete Contract

Originally Posted by Gripper
Hi Everyone

I have been working in the US for an small IT support company for the last 2 and a half years. I am a permanent resident.

I have been told that I must sign a non compete form or I will be dismissed. I have also been told that I am doing a great job and my boss has no complaints with the work I do.

This all came about because another technician went to work for one of our clients. The client then cancelled their support contract with us.

I refused to sign the contract stating that this should have been done when I joined the company and that I should receive some sort of incentive to sign it.The contract was completely unfair as you can see below.

I ............ being employed by ......... Computer Services, Inc. agree that I will not take the offer of employment (involving the scope of duties integral to my current position of a netwrok systems technician) from any client of said comapany for a period of two years post termination and/or geographic vicinity of a 30 mile radius of said company's ........... location.
The same restrictions follow regarding self-employment and solicitation of .........'s clients.

I sat and spoke with my employer and he agreed that the contract was unfair and that he would rewrite it. He also stated that my incentive for signing would be "continued employment". I would have to sign one or be dismissed. I am currently waiting for the next contract.

If I am dismissed will I be able to collect unemployment from him? and do I have a good case for unfair dismissal?

Should I call his bluff and refuse to sign one at all? I'm sure business will be hurt if I leave.

I understand that I will be receiving your personal opinions, advice and experiences and not legal advice.

Thanks

Gripper

Hi

The employment laws in the US are very different to the UK

They do not have to give you verbal warnings or written warning to dismiss you

Unless you have something to hide I would agree to sign or find another job now

A non compete clause is usually so you do not set up in competition with them. I do not think they are unreasonable bearing in mind what has happened to them
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Old Feb 3rd 2006, 8:01 pm
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Default Re: Non Compete Contract

Hmm.
I am not a lawyer but I do know that if it came down to a scrap it would ba about who is being reasonable. So here's my 2p:

1. You sound like a fair-minded bloke. Thats always a good start.
2. Its understandable after what happened the firm wants to protect itself.
3. It is reasonably normal for US firms to have non-competes, so it kinda goes with the territory.
4. If you move job there's no guarantee you won't have to sign another one.
5. Your boss is rethinking it so he must be a reasonable guy too.
6. You probably signed something on day one which gives them the right to change your Ts and Cs and the drop of a hat (thats normal too in the US). However, it is is usually reasonable for you to ask for an explanation in writing of that change.

My guess AND IT IS ONLY A GUESS is that you should consider signing IF the company gives you an explanation in writing of what it is asking you to do and why it is asking you to do it and what will happen to you if you don't.
You should also ask for an idea of their market penetration within a 30 mile radius. If it turns out they only have customers within 10 miles then the 30 miles is unreasonable. If it turns out they have 85% market penetration (I know - Im being hypothetical) then any restrictions would be unreasonable. Once you have all that, insist on lodging your own written protest or sign with "under protest" above your name. That way it is clear that you were coerced. Now if they sue you later you have lots of paper to wave at a court. If you dont get these supporting documents you will be royally stuffed. If the company will not provide such documentation then ask for why.

Try to avoid the pride thing. Its a crappy deal when someone changes your T's and C's like this. Its as though you are the villain. It will only drive you nuts.

All that said, I think you should spend half an hour with an employment lawyer.
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Old Feb 3rd 2006, 8:44 pm
  #4  
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Default Re: Non Compete Contract

Thanks for your replies

I have been researching this on the web. It depends on which state you live in as to how the law is interpreted. Here in PA it seems that these contracts are not liked by the courts, but they are upheld if they are reasonable and correctly written.

They also say that the timing of the contract plays a role in this. As I have been in the company for two years I should be offered some consideration for signing - continued employment is not considered enough by PA courts. I have already been told that no further consideration will be offered.

I read about a guy who was breaking his non compete contract but it wasn't upheld by the courts because he received no extra consideration for signing it.

Maybe I should sign the next contract "under duress" and then later get it dismissed because I received no extra consideration or maybe I should get dismissed and go to work for the competition (there are 2 more companies like this one within a mile !). My boss will be forcing me into doing the very thing he is trying to stop me doing !

It's p*ss*ng me off to say the least.
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Old Jul 30th 2006, 9:03 pm
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Default Re: Non Compete Contract

Update to the non-compete.

After the boss saying its being re-written nothing came back.

I asked him about it and he said. "we are not going to bother with the non compete forms as they don't hold much water in pa".

Instead he is getting clients to sign off on a document to say they will not employ anyone from our company.

So that's the end of that.
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Old Aug 23rd 2006, 2:57 pm
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Default Re: Non Compete Contract

Originally Posted by Gripper
Update to the non-compete.

After the boss saying its being re-written nothing came back.

I asked him about it and he said. "we are not going to bother with the non compete forms as they don't hold much water in pa".

Instead he is getting clients to sign off on a document to say they will not employ anyone from our company.

So that's the end of that.

All came out well in the end eh mate, good luck.
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