Non-compete in NY

I previously worked without a non-compete for Company A which filed for bankruptcy. An employee of this company secretly informed all the consultants that Company A was going out of business and arranged to have us move under his new firm, Company B, working for the same client which Company A secured for me. Initially, there was no non-compete with Company B, then the client decided to work with only 3 vendors and Company B wasn't one of them. During that time, I made the error of signing a non-compete with Company B that says I can't work for the client for 1 year after the assignment ends.

The client recently reduced all consultant's fee by 20% and Company B deducted the entire amount from my rate. Does this make my non-compete void? Also, since I am a W2 employee, if I refuse to sign the contract this year what would I risk and what choices do I have to break this agreement?

Thanks in advance

1 answer  |  asked Dec 29, 2002 8:57 PM [EST]  |  applies to New York

Unlock Non-Compete Agreements: Keys to Escape

Answers (1)

David M. Lira
How to Break a Non-Compete Clause

New York Courts, generally, do not like non-compete clauses in employment agreements, but that does not mean New York courts will never enforce them.

Also generally, the courts will be more likely to enforce a non-compete if it is written narrowly. To a large extent, the enforceability of a non-compete also depends on the nature of the job involved.

Whether and when you can get out of a non-compete agreement depends on what the non-compete says. When a non-compete expires depends on what the agreement says. There is no presumption that an employment contract is for a year at a time. The contract has to say that to be so.

If the employer's practice is to get non-compete agreements from employees on an annual basis, and an employee refuses to sign it, the employer would be free to terminate the employee, even if the non-compete is a kind which courts are not likely to enforce. This is because of the employment at will doctrine, which says an employee can be fired at any time for any reason, even for no reason or a false reason.

posted by David M. Lira  |  Dec 30, 2002 09:34 AM [EST]

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