Three year no-compete agreement

I worked for a Lawn care company, which made me sign a no-compete after I was employed there for about 10 months besides winter time layoff. The only consideration that I received was keeping my job. My salary was greatly reduced when the company sold half of their business and changed the area that I worked in, so I quit my job, went to another company, and started my own company. The no-compete agreement states that I can not start my own lawn care company for three years after the date it was signed within 50 miles of their office.
I just received a letter from their attorney that they will not do anything this season, however if I am still operating next season they will have no alternative but to take me to court. Do you think that it will hold up?

1 answer  |  asked Sep 26, 2004 9:15 PM [EST]  |  applies to Pennsylvania

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Answers (1)

Christopher Ezold
This non-compete does not appear to be enforceable.

Before I respond to your inquiry, I must state that we have not spoken, I have not reviewed the relevant documents and facts, and I do not represent you. Therefore, my discussion below is not a legal opinion, but is informational only. Finally, my discussion applies only to issues to which Pennsylvania or Federal law apply, unless otherwise specified.

That being said, it does not appear that the noncompete you were offered is valid. Generally, in Pennsylvania, for a noncompete to be valid, you must be paid for it. For your 'continued employment' to be valid payment, the noncompete must be offered BEFORE you begin working for the employer. The theory is that once you are employed, you cannot be paid with what you already have (employment).
As you did not sign the noncompete until well after you began working, there does not appear to be any payment to you for it, and the noncompete is invalid.

Furthemrore, there is a valid argument that the significant reduction in your compensation and the area in which you worked would prevent enforcement of the noncompete. The employer would only have a legitimate business interest in preventing you from competing in the area that you served. At the very least, even if the noncompete were enforceable, it would most likely only be enforceable in the limited area in which you were working at the end of your employment. The fact that your employer is allowing you to 'complete the season' is also an argument that the employer has no legitimate business interest in preventing you from competing.

If you would like to discuss this matter further, please feel free to contact me at the below address(es) or number.

/Christopher E. Ezold/
Nancy O'Mara Ezold, P.C.
401 City Line Avenue,
Suite 904
Bala Cynwyd, PA 19004
(610) 660-5585

posted by Christopher Ezold  |  Sep 28, 2004 1:33 PM [EST]

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