Can an independent contractor be prevented from working elsewhere with a competitor?
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Can an independent contractor be prevented from working elsewhere with a competitor?
I am a 1099 contractor with a company and that company has cut down my hours and pay with little notice. Are the legally allowed to stop me from seeking work elsewhere in the same field, even with a competitor? I have never signed a non-compete clause, nor have I signed any employment contract with this business that outlines any details of my employment. Everything has been verbal agreements or implied. However, I sought additional work and I was told I could not do so. As a contractor, I don’t think they can do this to me.
Asked on September 6, 2016 under Employment Labor Law, Maryland
Answers:
M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney
Answered 7 years ago | Contributor
A non-compete agreement would certainly prohibit you from obtaining outside employment with a competitor now or in the future. However, in if no such agreement was entered into, your employer can still terminate you if you attempt to seek such other employment. The fact is that a worker can be discharged for this reason, any reason or no reason at all. This is known as "at will" employment, which means that a company can set the conditions of the workplace much as it sees fit. And this applies to both W-2 and 1099 employees. The only exceptions would be if such action violated the terms of an employment contract or union agreement. Also, this treatment must not constitute some form of legally actionable discrimination.
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