Restrictive covenant for non- compete agreement exists only between the employer and the employee? Or also exists between two corporate companies on a contract personal?
Hi Vamsee! Restrictive covenants can exists between companies and contracted personnel under certain circumstances. Please send me an email at ashly@atcauselaw.com if you have a specific question about this.
Will non-compete or restrictive covenant agreement still be valid after acquisition? The name of old employer is on the agreement when signed not the new one.
Great question! As a starting point, you'll want to review the restrictive covenant agreement that you signed to see if there is a clause that allows the covenant to be assigned to a successor in interest (the successor would be the company that took over after the acquisition) or a clause that states something to the effect of "this agreement inures to the benefit of successors and assigns" or something similar to this. If there is nothing like this in your agreement, then you may be in a decent position to argue its enforceability. However, if your agreement was assigned to the acquirer, and this company has taken over the obligations associated with employing you, including paying your salary and benefits, then it's possible this company would be able to enforce the restrictive covenant. Regardless, an attorney would need to read the agreement that you signed, and possibly gather some information regarding the acquisition, in order to give you a well informed answer.
Restrictive covenant for non- compete agreement exists only between the employer and the employee?
Or also exists between two corporate companies on a contract personal?
Hi Vamsee! Restrictive covenants can exists between companies and contracted personnel under certain circumstances. Please send me an email at ashly@atcauselaw.com if you have a specific question about this.
Will non-compete or restrictive covenant agreement still be valid after acquisition? The name of old employer is on the agreement when signed not the new one.
Great question!
As a starting point, you'll want to review the restrictive covenant agreement that you signed to see if there is a clause that allows the covenant to be assigned to a successor in interest (the successor would be the company that took over after the acquisition) or a clause that states something to the effect of "this agreement inures to the benefit of successors and assigns" or something similar to this. If there is nothing like this in your agreement, then you may be in a decent position to argue its enforceability.
However, if your agreement was assigned to the acquirer, and this company has taken over the obligations associated with employing you, including paying your salary and benefits, then it's possible this company would be able to enforce the restrictive covenant.
Regardless, an attorney would need to read the agreement that you signed, and possibly gather some information regarding the acquisition, in order to give you a well informed answer.