eSignature Lawfulness for Non-Compete Agreement in Canada - Simplifying Legal Documentation

How to eSign a document: eSignature lawfulness for Non-Compete Agreement in Canada

hi josh hi amanda what are we talking about today today we're going to talk about non-compete agreements really typical scenario that i see a lot and i'm sure you do too is a potential client comes in to see me and they've signed a non-compete with a previous employer they're now working at a subsequent job really happy things are going great and they receive a cease and desist letter from a law firm that's representing their prior employer and they're quite reasonably freaking out a little bit right they don't typically receive this type of correspondence from a law firm and they don't know what to do and they show up in my office and they say help me uh let's chat with the employees in connecticut and let them know what do you do when this happens yeah i do a lot of this non-compete defense representing uh employees who are concerned about the enforcement of non-compete so first step take a breath you're not the first person to get a letter like this this nobody's going to jail about this nobody's going to die this is going to be okay this letter frankly might just be a scare tactic and your former employer is not really interested in taking it any further they just want to sort of put you on notice right so at that point nothing's happened so far but let's say you didn't just get a cease and desist letter you got served with a lawsuit right now you're a defendant in a lawsuit for a lot of people that's their first ever lawsuit they're really uncomfortable so the good news to start off with is not every non-compete agreement is enforceable right this is a question of state law so in connecticut non-competes are sometimes enforceable and sometimes not and other states have other rules so massachusetts for example has a statute about non-competes california basically doesn't enforce non-competes but here in connecticut the rule is your non-compete is enforceable to the extent it's reasonable which of course just sort of begs the question what does that mean well uh the courts use a five-factor analysis to uh to consider whether a non-compete is enforceable and the five factors are the geographic scope of the non-compete the temporal scope of the non-compete so so how many miles is it how long does it last the legitimate business interest of the employer the employee's ability to earn a living and the public interest whatever exactly that means so all of them are a little bit nebulous but if the non-compete is unreasonable on any one of those five factors then it is unenforceable as a matter of law the problem here for employees and frankly for employers too is that there aren't any hard and fast rules nobody really knows exactly how many miles is reasonable or unreasonable nobody really knows exactly how many months or years is reasonable or unreasonable it's sort of like um that famous supreme court quote about ography you know when you see it and so if you do enough of this non-compete work you sort of get a sense but for the for the average person who's getting a you know the average connecticut worker who's getting a letter a cease and desist letter or a lawsuit they're really not in a position to evaluate the merits of that and unfortunately that means they need to go talk to a lawyer right like us um and i wish that wasn't the case so one of the things we've done is we've supported we at garrison lebanon have supported legislation that would provide some clearer guidance for both employers and employees on the issue of non-competes a couple of bills were considered by the connecticut general assembly this session but unfortunately they didn't make it ultimately through the committee process so if a non-compete is something you're worried about in the short term one thing you can do is you know just talk to a lawyer about your non-compete figure out if it's actually going to be enforceable but another thing you could do frankly something that might make a difference for a lot of people is consider giving your legislator a call call your member you know your representative or your state senator and say hey i've got a non-compete i'm concerned about it this is a priority for me as your constituent and i really hope that you will take some action in future sessions to make sure that we have more predictability here non-competes are a tool that a lot of companies are using uh not just against you know or with respect to their senior executives but jimmy john's famously had a non-compete with respect to so-called sandwich artists that's ridiculous right nobody earning close to the minimum wage should be prohibited from taking any job they can get to improve their situation and states like massachusetts have really taken that lesson to heart and i think connecticut hopefully is on the cusp of doing so so hopefully that provides some information for people who are facing it on computer thinking about it if you have more questions about it feel free to reach out to us or another connecticut employment lawyer who can help you um think about your situation this is great advice thank you so much uh and remember that this is connecticut law so whether you're in new haven hartford litchfield stanford it doesn't matter it's all the same that applies to you thanks so much for watching and we'll see you next time thank you you