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Law Educator, Esq.
Law Educator, Esq., Attorney
Category: Employment Law
Satisfied Customers: 111549
Experience:  20+ Years of Employment Law Experience
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I am currently working for a client through a vendor, and

Customer Question

I am currently working for a client through a vendor, and client has decided not to extend contract to Vendor
This is the relationship
Client-->Vendor1-->vendor2-->Employer-->Me
Client asked me if I can work with them through a new vendor and I said yes but my employer has a SUB-CONTRACTOR AGREEMENT with the old vendor so I have joined a new employer and started working with same client. But now old vendor sent contract agreement to my previous employer and asking them to pay fines because I am working with same client but not through the same old vendor.
Here is the description in the SUB-CONTRACTOR AGREEMENT and this agreement is with my ex-employer
--"Unless otherwise agreed to in writing by ABC Solutions Inc., during the Term and for a period of one year after
termination or expiration of this Agreement, SUB-CONTRACTOR will not directly or indirectly, for SUB-CONTRACTOR's own
benefit or for any other third party:(a) solicit the Client(b) encourage, in any way or for any reason, any customer, client (including the
Client) or account of the General’s Office / Client to sever or alter the relationship of such customer, client or
account with General’s Office / Client or (c) solicit, employ, or attempt to entice away from any of General’s Office (AGO) / Client’s employees."--
My previous employer is based from State of Washington and I worked in State of Ohio(Client location)
Where there be any consequences to me?
Because I am working for a same client but different vendor. Not to forget client didn't extend contract to old vendor
Submitted: 3 months ago via Cornell Legal Info Institute.
Category: Employment Law
Expert:  Law Educator, Esq. replied 3 months ago.
Thank you for your question. I look forward to working with you to provide you the information you are seeking for educational purposes only.
You, the client and your new employer can both be sued for breach of contract and also for tortious interference with contractual relations for you violating the non-compete part of this agreement. If there is such an agreement in place, all of you would be parties to a legal action for breach of that non-compete agreement and/or for interfering in the contract between the old vendor and company. So, all of you could be sued and be held jointly and severally liable for damages that the company suffered from you leaving and going to work for the client, including lost profits AND the court could issue an injunction preventing you from continuing to work for the client and enforce the one year provision.
Customer: replied 3 months ago.
I would like to get clear idea on what you are sayingOld contract
Client-->Vendor 1-->vendor 2-->Employer-->Me: In this case Vendor 2 and my ex-employer have a contract and me and my ex-employer doesn't have contract. Client & vendor 1 Or vendor 2 doesn't have contract here according to client.Question
1. In this case Vendor 1 & Vendor 2 didn't agree to Client requirements and they have decided not to proceed with contract extension, until the end of existing contract I completely worked with Vendor 2.New Contract
Same Client -->New Vendor (Not Vendor 1 or Vendor 2)-->New employerQuestion
1. Since old vendors didn't get there contracts renewed I don't see any losses there, please let me know if you disagree?
2. Since I don't have any contract with my ex-employer, I am not seeing any breach of contract. Please share your thought on this.According to the above message Vendor 2 has contract with my ex-employer so how will my new employer is responsible for this?Thanks,
Naren
Expert:  Law Educator, Esq. replied 3 months ago.
Thank you for your reply.
While you do not see losses, the old company has a contractual agreement with their vendors to not compete, which is an enforceable contract. Even if they did not get the contract renewed, the clause is an enforceable contract clause in WA and OH. These non-compete clauses are designed to protect interests of the companies. They would have to prove their losses if the contract does not provide for any liquidated damages, but at the very least they can still get an injunction to prevent you working for the client in violation of the non-compete agreement.
You are not in breach of the contract, but you are tortiously interfering with the contract between old employer and company, which is grounds to bring you into the suit and prevent you from continuing to work for 1 year for that client I am afraid. Or in the alternative, your client would have to pay some type of damages to old company for the violation or interference in that contractual agreement.

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