Can an employer’s action invalidate a non-compete agreement?
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Can an employer’s action invalidate a non-compete agreement?
The Board of a small company held its annual year end meeting. The chairman of the board stated at the meeting that all 3 members of the management team would receive YE bonuses if they signed non-compete agreements. The board is trying to sell the company and that is the reason for management to sign these agreements. The non-competes all specifically stated that the bonus would only be paid out upon execution of the agreement. So I signed the non-compete agreement and received the bonus. However, the other 2 members refused to sign and still received full bonuses. I have e-mails from the chairman personally stating he made that decision to pay them and not make them sign the agreement. Is my non-compete valid and enforceable the way this was handled?
Asked on January 17, 2016 under Employment Labor Law, Virginia
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 8 years ago | Contributor
Yes, it is enforceable against you, because you received your bonus: i.e. the company honored it's obligations vis-a-vis you and provided you "consideration," or something of value (the bonus) in exchange or the non-compete. It does not matter what they did or did not do for or in regards to other people: all that matters is that the honored their contractual obligations to you. When there is contract between A and B, what A does to, for or with C and D does not affect that contract.
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