2 years, 10 months ago
Non-Solicitation agreement?
So the company that I did consulting with closed the practice that I was working for. I am a private consultant, would I be competing with them if one of the customers that I did work for contacted me to fix a problem with their SharePoint server? This company has no qualified SharePoint person and would have to outsource any request that came in.
Separate topics with commas, or by pressing return. Use the delete or backspace key to edit or remove existing topics.
You can leave an optional "tip" with Mahalo's virtual currency, Mahalo Dollars. If you are asking a difficult question that might require some research, or if you'd like a wide variety of feedback, a higher tip often leads to more answers to your question.
M$3 Answers
1. Did you sign a non-competition clause? (What did it say, exactly?)
2. Are you in California? (Renders it null...even signed non-competes are illegal.)
Performing work for an ex-customer of an ex-employer shouldn't be a problem. Your obligations to your employer are non-existent, because you are no longer an employee. Your obligations to your _former_ employer center mostly on protection of trade secrets, proprietary information, maintenance of accounting and payroll (expenses, reimbursements, benefits, etc.).
In California (generally speaking), I cannot seek work from an existing customer of my current employer because of a direct competition for revenue. In some situations, this is not a conflict. For instance, a client buys marketing creative work, ad placement, etc from an agency I work for...then I get part time work at the client performing facility maintenance. The services are not the same, and the ad agency is not offering to fix the plumbing on weekends.
Some employers try to put non-compete clauses in employee applications or employee manuals, saying that the employee cannot contact clients or vendors, and cannot seek employment in the same field for XX years after termination. Some even state that the employee cannot seek other employment at all.
These fall flat in California. They are blatantly abusive of the employee. They're illegal. Their primary purposes are to scare employees away from being recruited by another company. There's also the threat, "You'll never get a job in this business...unless you do what I say."
I'm not seeing a conflict. My 2 cents.
But the California Supreme Court is upholding the law from as far back as 1872, with the ruling in EDWARDS v. ARTHUR ANDERSEN :
"We conclude that section 16600 prohibits employee noncompetition agreements unless the agreement falls within a statutory exception, and that a contract provision whereby an employee releases 'any and all' claims does not encompass nonwaivable statutory protections, such as the employee indemnity protection of Labor Code section 2802."
Basically, Arthur Andersen fired Edwards during the time he was being recruited by HSBC. Edwards had signed a non-compete/non-solicitation with Arther Andersen, and was being forced to get a TONC (termination of non-compete) from Andersen to clear the way to be hired by HSBC.
There was much confusion about what rights were being given up, and Edwards would relinquish the non-compete to HSBC's satisfaction. He was afraid of ongoing government investigations and possible litigation by Andersen clients...if he terminated the Andersen agreements he may have been held personally liable.
So...Andersen fired him and HSBC withdrew the employment offer, leaving this guy high and dry.
In this CA Supreme Court opinion, you'll read:
"Under the common law, as is still true in many states today, contractual restraints on the practice of a profession, business, or trade, were considered valid, as long as they were reasonably imposed....This was true even in California....However, in 1872 California settled public policy in favor of open competition, and rejected the common law 'rule of reasonableness,'..."
So, a lot depends on what state you're from, and what you did/didn't sign.
2. Are you in California? (Renders it null...even signed non-competes are illegal.)
Performing work for an ex-customer of an ex-employer shouldn't be a problem. Your obligations to your employer are non-existent, because you are no longer an employee. Your obligations to your _former_ employer center mostly on protection of trade secrets, proprietary information, maintenance of accounting and payroll (expenses, reimbursements, benefits, etc.).
In California (generally speaking), I cannot seek work from an existing customer of my current employer because of a direct competition for revenue. In some situations, this is not a conflict. For instance, a client buys marketing creative work, ad placement, etc from an agency I work for...then I get part time work at the client performing facility maintenance. The services are not the same, and the ad agency is not offering to fix the plumbing on weekends.
Some employers try to put non-compete clauses in employee applications or employee manuals, saying that the employee cannot contact clients or vendors, and cannot seek employment in the same field for XX years after termination. Some even state that the employee cannot seek other employment at all.
These fall flat in California. They are blatantly abusive of the employee. They're illegal. Their primary purposes are to scare employees away from being recruited by another company. There's also the threat, "You'll never get a job in this business...unless you do what I say."
I'm not seeing a conflict. My 2 cents.
But the California Supreme Court is upholding the law from as far back as 1872, with the ruling in EDWARDS v. ARTHUR ANDERSEN :
"We conclude that section 16600 prohibits employee noncompetition agreements unless the agreement falls within a statutory exception, and that a contract provision whereby an employee releases 'any and all' claims does not encompass nonwaivable statutory protections, such as the employee indemnity protection of Labor Code section 2802."
Basically, Arthur Andersen fired Edwards during the time he was being recruited by HSBC. Edwards had signed a non-compete/non-solicitation with Arther Andersen, and was being forced to get a TONC (termination of non-compete) from Andersen to clear the way to be hired by HSBC.
There was much confusion about what rights were being given up, and Edwards would relinquish the non-compete to HSBC's satisfaction. He was afraid of ongoing government investigations and possible litigation by Andersen clients...if he terminated the Andersen agreements he may have been held personally liable.
So...Andersen fired him and HSBC withdrew the employment offer, leaving this guy high and dry.
In this CA Supreme Court opinion, you'll read:
"Under the common law, as is still true in many states today, contractual restraints on the practice of a profession, business, or trade, were considered valid, as long as they were reasonably imposed....This was true even in California....However, in 1872 California settled public policy in favor of open competition, and rejected the common law 'rule of reasonableness,'..."
So, a lot depends on what state you're from, and what you did/didn't sign.
source(s):
http://lawzilla.com/content/noncompete.shtml
http://news.cnet.com/8301-1001_3-10010724-92.html
http://www.lexisnexis.com/clients/CACourts/ -- if you're in CA, you can lookup the Supreme Court cases for free.
http://lawzilla.com/content/noncompete.shtml
http://news.cnet.com/8301-1001_3-10010724-92.html
http://www.lexisnexis.com/clients/CACourts/ -- if you're in CA, you can lookup the Supreme Court cases for free.
You can leave an optional "tip" with Mahalo's virtual currency, Mahalo Dollars. If you are asking a difficult question that might require some research, or if you'd like a wide variety of feedback, a higher tip often leads to more answers to your question.
M$
I do not see how this kind of agreement can still stand tall if the company you worked for is now closed.
The agreement is to prevent employees from getting business from their business or from starting their own business. This also covers the business from anyone "Stealing" businesses from underneath them. It also protects against confidentiality of a business. But like I said if the company has Closed, then I do not see why you could not do this work after it was requested by a customer.
http://www.urgentbusinessforms.com/non-solicitation-contract.asp?OVRAW=Non%20Solicitation%20agreement&OVKEY=non%20solicitation%20agreement&OVMTC=standard&OVADID=25339874521&OVKWID=231568250021.
The agreement is to prevent employees from getting business from their business or from starting their own business. This also covers the business from anyone "Stealing" businesses from underneath them. It also protects against confidentiality of a business. But like I said if the company has Closed, then I do not see why you could not do this work after it was requested by a customer.
http://www.urgentbusinessforms.com/non-solicitation-contract.asp?OVRAW=Non%20Solicitation%20agreement&OVKEY=non%20solicitation%20agreement&OVMTC=standard&OVADID=25339874521&OVKWID=231568250021.
You can leave an optional "tip" with Mahalo's virtual currency, Mahalo Dollars. If you are asking a difficult question that might require some research, or if you'd like a wide variety of feedback, a higher tip often leads to more answers to your question.
M$
In this given link you can see the Non-Solicitation agreement form.....
http://www.docstoc.com/docs/189369/Non-Solicitation-Agreement
In this link you can get the information about law of Non-Solicitation agreement
http://www.quickmba.com/law/empl/
Guideline:- Point D. read about Non-Solicitation agreement
http://www.docstoc.com/docs/189369/Non-Solicitation-Agreement
In this link you can get the information about law of Non-Solicitation agreement
http://www.quickmba.com/law/empl/
Guideline:- Point D. read about Non-Solicitation agreement
You can leave an optional "tip" with Mahalo's virtual currency, Mahalo Dollars. If you are asking a difficult question that might require some research, or if you'd like a wide variety of feedback, a higher tip often leads to more answers to your question.
M$
Good answer. What exactly you signed and the jurisdiction will decide if the agreement applies.
However in the circumstances, since the company is not in a position to provide the service is question, even if the non-compete clause technically applies, you can probably come to some arrangement with your former employer. i.e. They waive the agreement in this case, or you do the work under their branding and they get a cut.