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Ely
Ely, Counselor at Law
Category: Legal
Satisfied Customers: 86657
Experience:  Private practice with focus on family, criminal, PI, consumer protection, and business consultation.
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legal action is being taken against me for hiring an employee

Resolved Question:

legal action is being taken against me for hiring an employee away from a company that I worked for about 2 years ago. I have an NDA and employee handbook that I signed. Recently I made an offer to hire one of their employees and she accepted (after her current employer counter-offered for her to stay). She has not yet started working for me.

Separately I am a subcontractor on a job where the end client is a client that my previous employer works with. The work that I do is not the same type that my former employer offers.

I can send copies of the NDA and Employee Handbook.
Submitted: 10 months ago.
Category: Legal
Expert:  Ely replied 10 months ago.
Hello friend. My name is XXXXX XXXXX welcome to JustAnswer. Please note: (1) this is general information only, not legal advice, and, (2) there may be a slight delay between your follow ups and my replies.

I am sorry for your situation. Can you please tell me:

1) To sue in a state court, one needs to have a "cause of action." There are numerous causes of action, such as "breach of contract," "negligence," "fraud," "unjust enrichment," etc., as well as causes of action rooted in statutory law. Every state has their own although they are very similar to each other in every state because they all stem from the same common law. A pleading in Court needs at least one cause of action, although it is not unusual to have more than one. What are they suing you for?

2) Who is suing you?

3) Are they alleging that breached a non-compete, or something similar?

4) What exactly are you asking here?

This is not an answer, but an Information Request. I need this information to answer your question. Please reply, so I can answer your question. Thank you in advance.
Customer: replied 10 months ago.

1. I received an email from my previous employer that had the Employee handbook and NDA attached and said:


"These documents prohibit you from hiring our employees, working with our clients, and or competitors. We feel that a material breach has occurred and we are taking all steps necessary to protect our interests under our agreements."


 


2. Bunting Graphics. I am a consultant, I build databases. Usually I work as a consultant but I was hired as an employee by Bunting Graphics. I left there in September of 2010.


 


3) Are they alleging that breached a non-compete, or something similar?


As noted above. And I don't see where the item about hiring employees is in there, though I may be missing it. The are also aleging that I am not permitted to work for one of their clients (they are bringing a suit against the client I am told).


 


4). What are my options? I would still like to hire Teresa but I'm not sure that I can if it will cost me money in a lawsuit. I would also like to continue to work with the client if possible.


 


 


 

Expert:  Ely replied 10 months ago.
K,

Okay, thank you. So at this time, you have not been sued, correct? They have simply threatened to sue. Correct?
Expert:  Ely replied 10 months ago.
K,

What you have here is them threatening you over your alleged signing of a non-solicitation agreement that disallows hiring of their workers. They have not sued you as of yet. Now, I am going to assume that such a document was signed that restricts you from hiring any employees/former employees of the company for a period of time.

In Pennsylvania, there is no law that specifically addresses restrictive covenants (which is what this is); rather, courts look to the reasonableness of the restrictions in deciding whether a non-compete and non-solicit agreement is valid and enforceable.

So is the non-solicitation agreement enforceable? It is on a case by case basis and some guidelines are:

1) Insulation Corporation of America v. Brobston. "Salesman, discharged for poor sales performance, cannot reasonably be perceived to pose the same competitive threat to his employer’s business interests as the salesman whose performance is not questioned, but who voluntarily resigns to join another business in direct competition with the employer."

2) All-Pak, Inc. v. Johnston. An employee who leaves ON THEIR OWN may come to work for the other company, provided that the company did not actively solicit them.

These are just guidelines. Again, the Court will see each matter on case by case basis, deciding on the facts at hand, the reason for the non-solicitation, the length of the contract, and so on.

Someone in your situation has the following options:

1) Hire the employee anyhow, but risk them filing suit for breach of non-solicitation. If so, then one's affirmative defense would be that the non-solicitation agreement was NOT REASONABLE. Hopefully, the Court will agree. OR, they may end up not filing suit at all.

2) Not hiring her.

I am afraid that these are your two choices here.

The very same applies with any clients who may be part of a non-compete (for client) agreement which may be part of or back to back with the non-solicitation (for worker) agreement.

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Ely, Counselor at Law
Category: Legal
Satisfied Customers: 86657
Experience: Private practice with focus on family, criminal, PI, consumer protection, and business consultation.
Ely and 5 other Legal Specialists are ready to help you
Customer: replied 10 months ago.

Thank you for the response. The non-compete issue is clear enough. My situation is very similar to All-Pak v Johnston. As far as I am concerned this issue is moot.


 


Regarding the employee, I will have to review the documents again, I just don't see that clause.


 


Thank you for your help.


 


Best regards,


Thomas

Expert:  Ely replied 10 months ago.
You got it Thomas...best of luck. But NOTE that the case listed is not law, but is simply a "guideline." Every case is different. There is no guarantee your case will be the same even if the facts are similar.

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