signed Non-compete while doing a school internship.

I went to school to become a medical transcriptionist and part of my required course was to to do an internship. My school adviser set me up with a transcription service to do 144 hours of transcription in order to get my credits. on the first day of my internship, the company manager had me sign a Non-compete contract. after i had signed the contract i was told that i would be making 5 cents a line while doing my internship, which is 2 cents less than the regular employees. towards the end of my internship the company asked me to stay on as a permanent employee. i accepted and got my 2 cent raise. i also work out of my home for this company. The company has been having a lot of financial problems, and doing illegal things like not paying the IRS or Social Security even though they have been taking it out of your paycheck,(they have been reported as of two days ago) not to mention other things, and we are concerned the company may go under. there is no other transcription company anywhere else around here. several of us employers would like to get together and open up our own transcription company which would mean that we would take the companies accounts away from them. am i still legally bound to the contract even though i was doing my internship when i signed it? I was not informed by my advisor that i should or should not sign it. i did not know that i would be hired on a permanent basis or i would not have signed it. Also, if the company files bankruptcy and opens up a new company with a different name, would i still be bound to the contract. Also, with the illegal doings that they have been doing with our taxes, etc., could that let me off the hook? thanking you in advance for any information you might be able to give me.

1 answer  |  asked Sep 12, 2003 12:17 PM [EST]  |  applies to Indiana

Answers (1)

Brenda Franklin Rodeheffer
Non compete

Non competes are controlled not by a statute, but by case law which means you have to examine each case individually on the facts and weigh it against the caselaw. For that reason, it is hard to give a quick free consultation. It is best to sit down with an attorney and go over the facts. Nevertheless, I think that the company's failure to pay payroll taxes should take you off the hook regarding the non-complete. Note: it SHOULD take you off the hook, but it is not an absolute.

posted by Brenda Franklin Rodeheffer  |  Sep 14, 2003 9:44 PM [EST]

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