My previous employer is asking me to pay some amount to release me from the company
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My previous employer is asking me to pay some amount to release me from the company
I was a consultant in a company and working at client site. The client offered me a full-time job
and I took it. Now my consulting company is asking me to pay some amount or theyll file a case against me. I did sign non competent agreement but it was signed 3 years ago and I think it was valid for one year. But its been 3 years and still they are asking me to pay the fees.
Asked on April 3, 2018 under Employment Labor Law, New Jersey
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 6 years ago | Contributor
A one-year compete generally stays in effect until you leave work and then the one-year period begins; what it means is that you cannot compete for one year after you leave. So if you left this company 3 years ago and had a 1-year noncompete, it would not bar you from working for the consultant. If there is no enforceable non-compete agreement (i.e. it has expired), there are no grounds to stop you from competing; in this country, you can compete at will with an employer except 1) to the extent there is an in-effect non-compete stopping you; or 2) you cannot use confidential or proprietary information gained during the employment to compete with the business from whom you received that information (i.e. you can't use their property--their information--against them).
However, there is another type of agreement that might bar you: there are what are commonly called "non-solicitation" agreements that bar you from working for or at your employer's specific clients, and these agreements can be enforced for longer than non-competes--they can even be perpetual (i.e. never work for someone who was your employer's client while you worked for the employer). They don't stop competition generally, but do prevent you from working for someone whom you may have met or formed a relationship with specifically due to your employment. If you signed something like that, it could be binding on you.
Ask your former employer to show you the agreement(s) they claim prevent you from working for this client--then you can evaluate your rights. If they don't have any such, you are free to work for the client; if they claim to have such agreements but won't show them, simply tell them you cannot and will not agree to pay them money unless they show they have a legal right to it. You can then start working for the client. If they do have an agreement that will stop you from working for this client, they may try to sue you later, but to win, they would have to prove in court the existence of an agreement (i.e. produce it) and show that it bars you from working for this client.
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