How best to get out of a non-compete clause?
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How best to get out of a non-compete clause?
Approximately 2 years ago, I was laid off and signed a severance agreement that includes a “cannot compete clause” in exchange for a lump sum payment. I now have an opportunity to work for a company that could be considered a competitor. Is there any way the clause might not be enforceable? Even if it doesn’t hold up, my original employer could jeopardize my situation by threatening the other company, or me, right? Is my best course of action to ask my previous employer to waive the clause? Is there a gentler way of asking this (e.g. “Please clarify companies considered as competitors”)?
Asked on July 13, 2011 under Employment Labor Law, Pennsylvania
Answers:
SJZ, Member, New York Bar / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
Consult with an employment attorney before doing anything, and let him or her read the agreement, evaluate your specific situation (job level, title, industry, etc.), and determine what your obligations are. While non-competition agreements can be enforced, they can't be open-ended--that is, they generally can't stop you from competiting forever, but usually only bind you for a certain period, typically 6 months to 2 years. They also usually only apply to either a defined geographic scope (e.g. within a certain radius) or within a defined market niche and type of job (e.g. you couldn't be a field sales rep for a software company, but you could work in marketing in software, or field sales in hardware)...all in all, there must be some limitations on it, because courts will not interpret these agreements to stop you from working in a field in which you are qualified forever. Instead, they read the agreements to provide a reasonable amount of protection for the company, but not more than was necessary. Therefore, you should consult with an employment attorney, who can advise you as to what the limitations of the agreement seem to be--i.e. to what extent and for how long a court will enforce it--and then represent you, if necessary, if the former employer tries to enforce it past you consider appropriate.
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