Can I get out of my non-compete or non-solicitation agreement? Here's what you need to know.
Many employers require their employees and independent contractors to sign non-competition and non-solicitation agreements or sign employment/independent contractor agreements that contain non-competition/non-solicitation provisions.
A non-competition agreement/provision is an agreement between an employer and an employee or independent contractor that attempts to restrict the employee/independent contractor from working for a competitor or starting a competing business for a certain time after leaving the company.
A non-solicitation agreement/provision is an agreement between an employer and an employee or independent contractor that attempts to restrict the employee/independent contractor from soliciting the employer's clients or customers for a certain time after leaving the company.
Both are a form of “golden handcuffs”—as they essentially “chain” an employee/independent contractor to his/her current job.
Some non-competition/non-solicitation agreements/provisions are valid, while others are not. The validity of a non-competition/non-solicitation agreement/provision depends on the applicable state law, the agreement’s language, and other circumstances.
Therefore, it is absolutely critical that an employee/independent contractor obtain legal advice from a Board-Certified employment lawyer before signing such agreements and definitely before deciding to compete against or solicit his/her employer’s clients or customers.
The consequences of failing to obtain solid legal advice can be severe—both financially and otherwise: employers frequently sue employees/independent contractors for “breaching” their non-competition/non-solicitation agreements/provisions. Additionally, employers frequently sue or threaten to sue a new employer for hiring an employee who has a non-competition/non-solicitation agreement. If the employer wins, the employee/independent contractor may be forced to stop working for the competing business and may be forced to reimburse the employer for the monetary harm caused by the employer’s unlawful competition/solicitation. These monetary damages can be very large.
At Newar Law, we have helped many employees/independent contractors “bust” these “golden handcuffs.” Our “Representative Cases” section includes examples of our successful work.
We would welcome the opportunity to assist you, a family member, friend, or colleague with your non-competition/non-solicitation agreement.
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