Non-compete, same client, two temp agencies

I worked for a temporary agency in NY for the same federal client for 5 years. I moved to AZ and found an identical position here with the same federal client, only represented by a different temporary agency, who I contacted, and worked at for 3 years. I quit 3 months ago due to lack of benefits with the new company.

Now, the original temp agency I worked for just got the entire national contract, and all other agencies are getting the boot nationwide. The client in AZ wants me back, but I'd have to go through my original agency. However, I signed a one year non-compete with the temp agency they're getting rid of. Since the first temp agency introduced me to the client to begin with, and my recent agency can't have the contract regardless, is there any way for me to get out of the non-compete? Right now, the "fired" agency wants the client to have my "original" agency hire them to hire me, which means I will miss out on the benefits of the "original" company, which I would have rather stayed with to begin with, and two companies will be middle men for my job! I think this is ridiculous, but I need the work. Do I get any legal exemption for working with the same client for the other agency originally, or am I out of luck? Thanks.

1 answer  |  asked Sep 29, 2006 11:37 PM [EST]  |  applies to Arizona

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Answers (1)

Francis Fanning
Non-competes have to be carefully scrutinized

Your question combines a number of legal and practical issues. The general rule in Arizona permits non-compete agreements, but only if they are necessary for the protection of legitimate interests of the employer, and only if they are reasonably restricted as to duration and geographic scope. Assuming the non-compete you signed is reasonably restricted, it may still be unenforceable because of the agency's loss of any protectible interest. The answer to this is not clear, and is the kind of issue that lawsuits are made of.
You are free to breach a contract and risk being sued for the breach. The agency has the burden of proving that its agreement is enforceable, so they might decide not to file suit. So if you have a choice, it may be worth the risk to ignore the non-compete and proceed to take the job through the first agency. But I doubt that the choice is yours. From the text of your question it appears that both agencies are aware of the situation. The first agency may not want to risk being dragged into a lawsuit, and may agree to the proposed arrangement that you dislike. In that case, the only leverage you might have would come either from the client objecting or from you threatening a suit based on Arizona's blacklisting statute. That statute prohibits two or more persons from entering into an agreement whereby a worker is kept from being employed. There is no Arizona caselaw interpreting the statute to say whether it even applies to a situation like this one, and the courts may not allow it to be used to defeat non-compete agreements.
Non-compete agreements are impossible to interpret without examining the exact language of the agreement, since they sometimes mean something other than what you may assume. I would recommend that you have an attorney review the agreement to be sure you understand it before trying to negotiate with either agency.

posted by Francis Fanning  |  Oct 2, 2006 2:21 PM [EST]

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