Forced to sign non-compete after starting employment...

When my husband was interviewing with a consulting company, he specifically asked if there was a non-compete agreement. He was told there was not.

The first day at the company was supposed to be orientation (filling out W-2, health insurance, LTD, etc.) Instead, the night BEFORE he was to go in to the office for orientation, he was called by one of the account executives and asked to go directly to a client BEFORE going in for orientation. He worked two and a half hours at the client location and THEN went into the office for orientation.

During the orientation process, he was given an employee agreement to fill out, which consisted of a single paragraph stating a non-compete. He was told he must sign the form or be fired -- this, AFTER he started at the client and AFTER he asked if there was a non-compete and told there wasn't. He signed the non-compete (although in retrospect he should have said NO!)

All of the consulting company's clients have similar non-solicitation agreements (to stop clients from going after the consulting company's employees.) The penalty for violating that agreement is $40,000 against the client.

Two and a half years later, one of the clients that my husband has done work for got the consulting company to void the non-solicitation agreement (even though the consulting company didn't realize that they agreed to it -- I don't they consulted their lawyer.)

The client, with the newly voided non-solicitation agreement, told the consulting company they want to offer my husband a contract because the consulting company does not handle their account correctly, but my husband does, so they want him exclusively.

The consulting company asked my husband is he wanted to pursue this offer. He told them he would, but he would be fair and finish out his current assignment (which ends in February.) He even went as far as to offer to work on a part-time, 1099 basis (as opposed to being a salaried employed) because the current client wanted to extend him until August. He thought this was a win-win offer to the consulting company, but instead they are threatening him with the non-compete.

Is the non-compete enforceable? It would only be my husband's word against the consulting company's about asking whether a non-compete agreement existed during the interview process (he did not get a written affidavit stating there wasn't, only the interviewer telling him.) However, he has witnesses that he was working at a client BEFORE going through orientation and being forced to sign the non-compete.

1 answer  |  asked Nov 6, 2002 7:57 PM [EST]  |  applies to Illinois

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Answers (1)

Aaron Maduff
Is the consulting company's non-compete enforceable against your husband

A lot of this depends upon the non-compete agreement. I would want to review it -- I imagine there are loopholes and creative ways to deal with it from your description. But even if there aren't in it, from what you have stated, there are several ideas that come to mind. Unfortunately, I would need some more information, particularly with regard to the work and what your goal is. This is definately a case worth your seeing a lawyer and having a consultation (we might be able to handle it with a single consultation). I urge you to give us a call (312) 236-8877 or another of the fine lawyers listed at MEL.
Aaron Maduff

posted by Aaron Maduff  |  Nov 7, 2002 01:35 AM [EST]

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