Non competing term

randomi15

Hi guys,

If you change employers and in your existing contract you have a non competing term what can happen?

I guess question is how law classes another business as direct compatitor of your current employer?

For instance if current employer manages it systems for smaller firm and your new employer is global and deals with much larger clients, can that business which has 500+ employees be seen as competing with the business that has 30+ employees?

What is ultimate financial and credit impact?

sangie595

randomi15 wrote: »

Hi guys,

If you change employers and in your existing contract you have a non competing term what can happen?

I guess question is how law classes another business as direct compatitor of your current employer?

For instance if current employer manages it systems for smaller firm and your new employer is global and deals with much larger clients, can that business which has 500+ employees be seen as competing with the business that has 30+ employees?

What is ultimate financial and credit impact?

The size of the company is not relevant. The actual terms of the restrictive covenant is. Often they are not enforceable, but there isn't any information here to make any guess as to that. You need to explain the terms. If it is enforceable, you AND the new employer may be sued, or they could apply for an injunction to prevent you working for the competitor. It doesn't often happen. But it can happen.

randomi15

Off top of my head it says I cannot work for client of theirs or someone whom
is a compatitor to them

That is it. It is a single paragraph.

So all they can do is stop me from
Working for them and no further penalties like prison or fine to pay?

Undervalued

randomi15 wrote: »

Off top of my head it says I cannot work for client of theirs or someone whom
is a compatitor to them

That is it. It is a single paragraph.

So all they can do is stop me from
Working for them and no further penalties like prison or fine to pay?

It is a civil matter not a criminal one so no, you can't be arrested and locked up. Unless that is they manage to obtain a injunction and you disobey that.

The problem is that you need really quite specialised legal advice about whether the particular terms in your contract are enforceable. It is not a simple area.

paddyrg

It may be entirely meaningless, and most of the time it'll not be enforced (because doing so costs money). It makes sense in some industries (eg motor racing engineering where you have very specific knowledge and the competition is well defined and there's millions at stake), but if you're a salesperson for bed pans, it makes no sense at all other than to sound scary.

Talk to the new employer, show them your contact, let them decide how to play it as their lawyers will take a look and see if they think it's a real threat.

sangie595

randomi15 wrote: »

Off top of my head it says I cannot work for client of theirs or someone whom
is a compatitor to them

That is it. It is a single paragraph.

So all they can do is stop me from
Working for them and no further penalties like prison or fine to pay?

I am afraid that you guessing what it says doesn't help. You need to supply the exact terms.