If a company does not pay severance money owed to an employee, does it void a non-compete that was part of the agreement?

Get Legal Help Today

Compare Quotes From Top Companies and Save

secured lock Secured with SHA-256 Encryption

If a company does not pay severance money owed to an employee, does it void a non-compete that was part of the agreement?

Asked on August 7, 2011 Pennsylvania

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

A severance package given an employee upon termination is typically not required under the laws of most states in this country. Severance packages typically depend upon the policies of the employer as well as custom and practice in the industry that the employer is in.

Most states have laws stating that non-competition agreements between employers and employees are "void" against public policy. The rationale is that public policy in this country demands that every former employee is entitled to seek employment to help themself and their family.

Assuming you have an agreement that your former employer is to pay you a severance but does not, the non-compete clause which is part of the severance package is unenforceable. Even if the severance was paid, I do not believe that the non-compete clause is valid in any event due to it being in violation of public policy.

You should consult with a labor law attorney about your situation.

Good luck.

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 12 years ago | Contributor

A severance package given an employee upon termination is typically not required under the laws of most states in this country. Severance packages typically depend upon the policies of the employer as well as custom and practice in the industry that the employer is in.

Most states have laws stating that non-competition agreements between employers and employees are "void" against public policy. The rationale is that public policy in this country demands that every former employee is entitled to seek employment to help themself and their family.

Assuming you have an agreement that your former employer is to pay you a severance but does not, the non-compete clause which is part of the severance package is unenforceable. Even if the severance was paid, I do not believe that the non-compete clause is valid in any event due to it being in violation of public policy.

You should consult with a labor law attorney about your situation.

Good luck.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

secured lock Secured with SHA-256 Encryption