Question

Business Law

You work in California for a company that is national in scope, selling in all 50 states. As part of the employee orientation, you are required to sign a contract in which it states that if you leave the company’s employ voluntarily, you will not be able to be employed or provide services for any company that is in competition with your current company’s geographic area for one year after leaving. After 2 years, you are invited to represent the company at a trade show in Dallas, where you meet a Houston, TX based company that sells competitive items. They offer you a similar job and a $10,000 increase over your current compensation and offer to pay for your move to Houston. You have family in Houston, so this is attractive.

2. Same facts as above, with this difference. A year ago, the company ushered you into a stock program that only the top 10% of employees get; it distributes company stock on an annual basis to you. You were asked to again sign the above non-compete as a condition of getting the stock, and you received a distribution already. Can you take the new job? Why or why not? Why is this different than the question above?

Answer 1

In the first case, we have already signed the non competent agreement where we as employee can not enter into employment of competition after a specific time specified in contract that is one year after leaving.

The fact that i have signed the non compteten agreement so i can not take employment at Houston, TX based company because i had to leave the company and wait for one year to last in order to get employment in company of competition.

Texas also comes in 50 states covered by my company so i can not enter into employment of competition's company. otherwise i can be sued by my company for violating the contract.

in second condition, I think i can take the new job because when there is new conditions addedd to the same contract then the previou non competent contract is terminated or we can say no longer valid now.

The above non competent clause does not specify any stock distribution condition so in this case, company had to make new agreement and void the previous one this is why it is different.