Can I sue an employee for leaving their contract early and setting up business in a competition with me?
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Can I sue an employee for leaving their contract early and setting up business in a competition with me?
She was on a 2 year employment contract, I taught her the trade. She left 1 year in and is not conducting business .3 miles from my business. I also have 3 year non-compete for 25 miles after the termination of the contract. Im looking to have her stop conducting business within 25 miles or sue her for what I would make in the
last year of her contract.
Asked on October 12, 2017 under Employment Labor Law, California
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
If you have a non-competition agreement, you can sue her if she violates it as she apparently is doing by setting up shop 0.3 miles from you. Note that courts will not enforce a 3-year compete against non-owner former employers (people you did not buy the business from), viewing them as excessively long, but you should be able to enforce the agreement for 6 - 12 months; the geographic radius of 25 miles is likely acceptable to the courts (i.e. not excessive) and so enforceable.
If she had a 2 year contract but left after 1, you may also be able to sue her for "breach of contract" for provable costs or losses directly traceable to her leaving early: e.g. the cost to recruit and train a replacement on an urgent, unexpected basis, or for lost profit if her leaving caused you to lose business or be unable to fulfill your own contracts with clients/customers, but you'd have to be able to prove with evidence how her breach (leaving early) led to these losses.
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