What can I do if my employer forced me into signing a contract and is now asking for money?

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What can I do if my employer forced me into signing a contract and is now asking for money?

I am a private tutor. A guy who runs a training institute asked me to teach there for $50 per hour. No contract was signed. I worked there for more than 6 months and I was always paid with a delay. Then, about 2 months ago, he found another teacher who was cheaper so he replaced me. He said that I’d be paid in a few weeks. Then last month 1 of his students contacted me for a 1-on-1 lesson as he liked my style of teaching compared to new tutor. Yesterday, my employer asked me to come to his office to collect the payment. When I reached his office he gave me a contract and told me that I needed to sign it in order for him to release my payment. He kind of arm twisted me into signing the contract as unless I did he wouldn’t pay the money that he owes me. The contract had a non-solicitation clause of $15,000 for a period of 3 years. After I signed it, he said that he would make the transfer in the evening. However, the transfer was not made and the next day he texted me saying that I violated a clause in the contract and now owe him damages of $15,000 or else he will sue me. Apparently, the student told him that I tutored him 1-on-1. However, this was done before I signed the contract. So he tricked me into signing a contract knowing that one of its term was already violated. Now, instead of him paying me, I have to pay him. Can I still owe him damages if the contract was signed on date later than the event for which he is asking for compensation?

Asked on January 14, 2017 under Employment Labor Law, Washington

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

First, he did not--in the eyes of the law--"force" you to sign. Since he legally owed you the money for the work you'd done, you could have refused to sign and sued him for the money. Since you chose instead to sign, you are held to the terms of the contract.
As to whether you could be in violation of the contract for something you did pre-signing, it depends on what exactly the contract says. Contracts can have retroactive effect, IF they say they do--that is, if the terms of the contract state they have retroactive effect. If so, then by signing the contract, you agreed to be held to the retroactive clause(s) and could be in breach (e.g. and owe money for breach) for something you did previously. Look in the contract for what "effective date" (when it went into effect) it has or other terms about when you were obligated to it.
However, the norm is that a contract takes effect on signing, so unless the contract states it went into effect earlier, it would take effect on the date you signed it. That means a prior act would not be a violation; you would not be in breach of contract or owe him money; and you could sue him for unpaid wages.
For future reference: you never have to sign an agreement you don't like. If someone says they won't give you something (like pay) which belongs to you unless you do, sue him or her instead.


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