termination for refusal to sign non-compete not supported by consideration

I had been working for a company for about 2 years and out of no where I was aked to sign a non-compete agreement. I did a little reaserch and found out in PA a non-compete has to be supported by consideration, like a raise/bonus. I talked to my boss, my boss's boss and the head of HR about this, and was pretty much brushed off, was told my salary/bonus had nothing to do with signing this non-compete and that I needed to sign it or "suffer the consequences". I refused to sign it and was promply terminated, do I have any recourse?

1 answer  |  asked Jul 30, 2010 7:05 PM [EST]  |  applies to Pennsylvania

Answers (1)

Christopher Ezold
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, you are correct that in Pennsylvania, when an employer asks you to sign a noncompetition agreement, you have to be paid for it (in cashe, valuable perks, benefits, etc.). Unfortunately, there is no law that says that they can fire you if you don't sign it, even though they don't pay you.

So you are in a catch-22; either sign a document that you know to be ineffective in order to keep your job (and potentially face a lawsuit based on that bad document down the line), or refuse to sign without being paid, and potentially lose your job.

There are good arguments that being fired for refusing to sign a noncompetition agreement without being paid for it is illegal under current law, but there have been no cases that have examined that issue. Usually, being the first case in any area is an expensive and risky proposition.

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/
Chair of the Board,
Magellan Leadership Group

Nancy O'Mara Ezold, P.C.
One Belmont Avenue,
Suite 501
Bala Cynwyd, PA 19004
(610) 660-5585

posted by Christopher Ezold  |  Jul 30, 2010 9:03 PM [EST]

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