If I signed a non-disclosure, non-solicitation and non-compete agreement with a new employer but was let go 2 days later, am I still bound by it?

I did not receive a paycheck; they wrote out a check on the spot.

Asked on October 1, 2014 under Employment Labor Law, Kentucky


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 6 years ago | Contributor

While you need to check the exact terms of the agreement to be sure, as a general matter, if you are fired by the employer, you are not bound by the non-competiton agreement. The theory is, the "consideration," or thing of value which you receive in exchange for giving up the right to compete, solicit, etc., is employment: so if you are fired, you are not receiving any consideration, and without consideration, there is no enforceable agreement. You say that you received  a check; that could alter the answer, but then you alo have to look to the amount of the check and the circumstances to determine the effect: for example, if paid only for a few days or weeks (e.g. 2 weeks, as in 2 weeks notice or severance), it is unlikely that check would support a non-competition agreement. On the other hand, if paid, say, 6 months salary, that would be sufficient consideration for a non-competition agreement.

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