Non-Compete after being RIF'd

I was let go by my previous employer about 3 months ago stating no further need for my services. Today, I was contacted by a customer of said previous employer. They are looking for someone to do contract work after being told that my former employer can not provide the services. I did sign a non-compete agreement. Former employer discovered this and is citing non-compete agreement. Can my new employer accept this work?

1 answer  |  asked Aug 2, 2006 9:02 PM [EST]  |  applies to Pennsylvania

Unlock Non-Compete Agreements: Keys to Escape

Answers (1)

Harold Goldner
Non-competes after RIF's

The answer, unfortunately, is that 'it depends.' Non-compete covenants are only enforceable if they are reasonable as to time and scope.

Some industries change over a matter of months, and a length non-compete would be unenforceable, others are less dynamic and longer periods may be acceptable.

This is because the covenant must be designed to protect some interest of the employer in the employee's services.

However, there is some case law in Pennsylvania which suggests that if an employer discharges and employee, they clearly did not value the employee's services, so for that employer to argue that they somehow need to be otherwise protected is inconsistent.

Sometimes the new employer can work out the differences with the former employer, especially where, as you describe, the former employer cannot satisfy the customer's needs by their own admission.

That's the short answer --- the long answer is to contact a competent attorney who can actually review your non-compete covenant and the circumstances of your RIF.

posted by Harold Goldner  |  Aug 9, 2006 4:23 PM [EST]

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