Is a non-compete enforceable if the overall employment contract was changed?

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Is a non-compete enforceable if the overall employment contract was changed?

My employer had me sign an employee agreement and non-compete for that job. Then, 6 months later, they changed my job title, description, docked my pay 50% and gave me a new employment agreement and a non-compete which was unacceptable so I couldn’t sign. I gave notice and

left. Are the changes a breach of the original contract thus voiding the non-compete?

Asked on April 15, 2019 under Employment Labor Law, Indiana

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

If the non-compete was part of the original employment agreement, then breaching the original agreement violated the noncompete and they cannot enforce it.
If the non-compete was not part of the original employment agreement but made reference to it, then violating the agreement which was effectively incorporated into the non-compete would also violate the non-complete and they could not enforce it.
If the non-compete was completely independent of the employment agreement but your pay was cut 50%, then they most likely cannot enforce it: a pay cut of that magnitude would likely be held to be "constructive termination" (effectively firing you by making your job so unacceptable no reasonable person would continue it). When terminated in any way by the employer, they cannot enforce a non-compete against you unless you received something valueable other than employment (like stock or a signing bonus) for signing it. But because constructive termination is inherently a subjective issue--how much of a pay cut is too much or unreasonable, for example?--we cannot say 100% that they could not enforce it; they could sue and get a judge who somehow expects you to put up with a 50% pay cut.


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