Can the new owner of a small business fire existing employees for refusing to sign a new non-compete clause?

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Can the new owner of a small business fire existing employees for refusing to sign a new non-compete clause?

Asked on November 29, 2010 under Employment Labor Law, Massachusetts

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 11 years ago | Contributor

Yes, the new owner may do this, except *possibly* unless and only to the extent that the employees have employment contracts guaranteeing their employment and/or setting forth the specific grounds for termination or the process for termination. If there is a contract, and IF the buyer of the business bought the business subject to existing contracts--which is not something he or she was obligated to do--then it would have to be honored. Other than that, employment is employment at will; the employer may generally terminate employees for any reason, at any time, and can set whatever terms and conditions of employment he or she wants, such as a requirement of executing a new non-compete clause, even for existing employees.


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