Pennsylvania law makes it easy to enforce noncompete contracts. But trying to make a business-interference claim against an ex-employee is almost a lost cause.
For that reason, it's doubly important to establish bulletproof noncompete agreements for all employees who carry the potential to pull businesses away from you when they depart.
Case in point: John Newman, an employee of the All Seasons food service company, signed an agreement in which he promised not to compete against All Seasons for three months after leaving the company.
When Newman quit, several customers sought him out for work. Several others received sales pitches from Newman. All Seasons sued, alleging breach of contract and business interference.
A Philadelphia court enforced the noncompete agreement, but it refused to rule that Newman intentionally interfered with All Seasons' business contracts. Under Pennsylvania law, contract interference requires proof that it was done with the specific intent to harm the other party, not just to steal business away. (All Seasons Services v. Newman, No. 2173, Philadelphia Court of Common Pleas, 2006)
Tip: When drafting your contracts, ask the attorney to make the noncompete period as long as possible within Pennsylvania law. Three months doesn't offer much protection when you can't make a claim of contract interference.
- How to Fire an Employee the Legal Way: 6 Termination Guidelines
- Not all offenses are equal--make the punishment fit the 'crime'
- What are the rules on hands-free cellphone use for commercial drivers?
- Are you ready for the EEOC's enforcement crackdown?
- Think lawsuit won't materialize? Test theory on calendar