Clarification about Non-compete Agreement

[johndoe2011]

Hi,

I have signed a NCA for my current employer Company A that says below...

5.0

Covenant Not To Compete. Employee agrees that during the term of employment with

Company, he/she will neither directly nor indirectly compete with Company in any manner.

Employee also agrees that for one (1) year following termination of his/her employment,

whether such termination is initiated by Employee or Company, with or without cause or notice,

Employee will not, directly or indirectly: (i) be employed by any past, present or future client of

Company in any capacity; (ii) act as an independent contractor for any past, present or future

client of Company in any capacity; (iii) perform any services for any past, present or future

client of Company in any capacity; (iv) own, manage, operate, control, assist, be employed by,

or participate in any business, or be connected in any manner with the ownership, management,

operation, or control of any business that provides services to any past, present or future client of

Company in any capacity; and (v) solicit any past, present or future client of Company in any

capacity for the purpose of providing services to any such client and/or arranging for any third

party to provide services to any such client. Employee understands and agrees that if he/she

breaches this Agreement, then the one (1) year restriction imposed under this Agreement shall be

extended and shall not expire until one (1) year after Employee permanently ceases to breach

this Agreement.

I am currently working for Client X thru Company B (middle vendor). So the setup is Me -> Company A -> Company B -> Client.

Then came this offer from Client X to work full-time for them.

Is NCA enforceable here? Is Client X considered as client of Company A? Will I violate anything if I join Client X?

Looking forward to your sincere answers.

Regards,

John

[wiweq]

This contract looks phony to me. Look at the line: (i) be employed by any past, present or future client of

Company in any capacity;

How can you determine the 'future' client?

Please involve a good attorney.

[JoeF]

Have that contract looked over by a labor law attorney.

[catx]

Non-compete clauses are considered in light of restraint of trade (e,g, trying to limit the ability of someone to make a living), and thus are considered legally valid and binding only when they are reasonable in terms of both duration (common practice is 1 year, but can be longer with highly specialized, proprietary research) and scope. From my read of the term and condition, it fails the reasonable scope test.

The courts could modify the scope to preserve an otherwise valid clause, or they could deem the whole clause and even the whole employment agreement invalid.

A qualified, experienced labor / employment lawyer is needed to make a full and proper assessment.

(Note: Non complete clauses are not valid in California, i.e. restricting someone's rights to make a living.)