I didn't sign a non-compete but my co. is considering sueing....
My brother and I work in a very specialzed field and there are not many individuals in our specific profession. We have never signed a non-compete with our current employer. We have decided to form our own company and upon tendering our resignation they alluded that they might sue to prevent us from doing so. They indicated that they could potentially prove that we were actually a "franchise". Is there any merit to this or is this a scare tactic?
1 answer | asked Aug 18, 2004 2:34 PM [EST] | applies to New York
Answers (1)
Employer Suing to Some Former Employees from Competing
The issue is never whether an employer (or anyone) can sue. The answer to that question is, yes, the employer can sue, and cost you money defending. (The real issue is whether the employer will win the lawsuit.)
Generally, courts do not like doing anything that will impede competition, or prevent a person from finding a job. This concern is part of the reason why courts look at non-compete agreements in the employment context very carefully. That is, an employer is already fighting an uphill battle trying to prevent an employee from stariting his or her own, competing business, or going to work with an existing competitor, even with a non-compete agreement.
Without some type of non-compete agreement, an employer has an even more difficult battle. I would say that, in the normal course, the level of difficulty an employer faces is nearly impossible.
But there may be some extraordinary cases where an employer might succeed. An example of where an employer might succeed is an area where the work is highly specialized. But the employer would probably need to show that the employee took proprietary information or trade secrets.
posted by David M. Lira | Aug 18, 2004 5:10 PM [EST]
The issue is never whether an employer (or anyone) can sue. The answer to that question is, yes, the employer can sue, and cost you money defending. (The real issue is whether the employer will win the lawsuit.)
Generally, courts do not like doing anything that will impede competition, or prevent a person from finding a job. This concern is part of the reason why courts look at non-compete agreements in the employment context very carefully. That is, an employer is already fighting an uphill battle trying to prevent an employee from stariting his or her own, competing business, or going to work with an existing competitor, even with a non-compete agreement.
Without some type of non-compete agreement, an employer has an even more difficult battle. I would say that, in the normal course, the level of difficulty an employer faces is nearly impossible.
But there may be some extraordinary cases where an employer might succeed. An example of where an employer might succeed is an area where the work is highly specialized. But the employer would probably need to show that the employee took proprietary information or trade secrets.
posted by David M. Lira | Aug 18, 2004 5:10 PM [EST]
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