What are the ramifications of signing a non-compete?

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What are the ramifications of signing a non-compete?

I work for physical therapy company in the administrative office. They gave me a non-compete to sign after 4 months and cut my pay and hours. I do recruiting for them but it says for 1 year I can’t solicit, accept business from, or render services to any of their prospective customers. My review was just prior to this and I was rated unfairly. I believe they want me to quit without being fired, thus not getting unemployment. I just want to move on but do not want to be bound by any agreement. What does the law say in PA?

Asked on February 8, 2011 under Employment Labor Law, Pennsylvania

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Non-competition agreements and non-soliciation agreements are valid and enforceable, and an employee may be made to sign them by being told that he or she will be terminated if he or she doesn't.  These agreements are only enforceable to the degree that are reasonable in light of the job, the employee's level and title, and local employment market or business opportunties for an employee like that, etc.; as a general matter, non-solicitation agreements are enforced more generously than other non-competition and  a one-year bar from soliciting prospective customers, especially if you only knew of those customers from your employment, is probably reasonable.

While sometimes working conditions change in such a negative way as to constitute "constructive termination" of an employee--i.e. he or she is forced to quit--a negative review very likely does not rise to that level. On the face of what you wrote, you would seem to be bound, but in agreements like this, circumstances are everything: bring the agreement to an employment attorney who can read it in detail and with whom you can share all the facts and details of your employment, in order to get an authoritative evalution. Good luck.


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