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  • Employment Agreement

    Hi, I'm living in CA. I hope someone can help me.

    I quit a job 1 yr and 8 months ago. Recently, the former employer threatened to sue me unless I pay $50,000 (as estimation of damage to the company) to him in 2 weeks. According to him, there are several reasons.

    1. Although I was "Exempt" employee, I took all compensatory days off (about 20 days) before leaving the company. I read the signed employment agreement again, but this was not mentioned in the agreement at all. My title was "VP"; however, I didn't have any rights to hire and fire any employees. The work duty was the same as other employees because of the small business.

    2. Currently, I'm working for another company. Some parts of this company's business are the same as the former employer's business. He says... that breaches the signed employment agreement. The agreement says that employee is prohibited to work for competitors in the US and Canada after employee leaves the company.
    This agreement was signed by the former employer and me after a month passed from the 1st day of the work, though. He gave employees 1 day to read it. Then, he threatened all employees to sign it. He said that otherwise a refused employee would be fired. Actually, 2 employees were fired.

    3. He says that I used trade secret of the company to acquire his customers.
    He has mentioned a few companies' name that he believes I stole his customers. But, I don't even know some of them. However, a few of them are now my customers because I won in the bids among other several competitors that include the former employer, too.

    These reasons don't make any sense to me at all. Please advise me what he says is legal in CA??

  • #2
    Employment Agreement

    1. Although I was "Exempt" employee, I took all compensatory days off (about 20 days) before leaving the company. I read the signed employment agreement again, but this was not mentioned in the agreement at all. My title was "VP"; however, I didn't have any rights to hire and fire any employees. The work duty was the same as other employees because of the small business.
    Regardless of your exemption status, your former employer cannot require you to pay for the time off that was permitted to you. If they did not feel that you should receive the time, they should not have permitted you to take the time while you were with them.
    2. Currently, I'm working for another company. Some parts of this company's business are the same as the former employer's business. He says... that breaches the signed employment agreement. The agreement says that employee is prohibited to work for competitors in the US and Canada after employee leaves the company. This agreement was signed by the former employer and me after a month passed from the 1st day of the work, though. He gave employees 1 day to read it. Then, he threatened all employees to sign it. He said that otherwise a refused employee would be fired. Actually, 2 employees were fired.
    He should have given you time to review it with your attorney. However, this isn't a basis upon which I would recommend that you take affirmative action against him. It could become expensive. Instead, your attorney (should you retain one) may be able to use that fact in your defense. Second, anti-competition agreements are often found to be unenforceable if the agreement is so strict as to prevent you from earning a living. For example, if the agreement prevents you from working in your chosen living, it will probably not be upheld.
    3. He says that I used trade secret of the company to acquire his customers.
    He has mentioned a few companies' name that he believes I stole his customers. But, I don't even know some of them. However, a few of them are now my customers because I won in the bids among other several competitors that include the former employer, too.
    Violation of a trade secret agreement can be enforceable if it can be proved that you did indeed utilize trade secrets in harming his business. However, it needs to be more than coincidental. In other words, he owuld need to be able to prove that use specifically used the trade secret, rather than you just having knowledge of it.

    He will need to pursue you on these accusations in court in order to receive the funds. Also, he could pursue your current employer if it is believed that the new employer hired you to make use of the trade secret. I strongly suggest that you talk with an attorney for guidance.
    Lillian Connell

    Forum Moderator
    www.laborlawtalk.com

    Comment


    • #3
      Employment agreement

      Thank you for your advice! I will find a lawyer ASAP.

      Comment

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