Legal Question in Employment Law in California
Non-Compete and Incorrect Sales Commissions
My ex-employer had to lay me off, or gave me the option of continuing to work on commission only. Immediately following this (I opted to be laid off), he contacted my new employer threatening to sue them and me because I signed a non-compete clause in my employment agreement.
The company I am working for offers a similiar product, but is produced entirely different - and the employer I was working with stopped offering these services 3 months ago.
In addition - I don't believe my sales commission reports were ever accurate in accordance with my employment agreement. I was to be paid a percentage of the Net Sales Revenue - which was never accurately reported.
I've also been put under duress for them contacting my new employer threatening them with a lawsuit for hiring me. Do I have any legal rights to sue and investigate my ex-employer and should I be worried about their threats?
2 Answers from Attorneys
Re: Non-Compete and Incorrect Sales Commissions
Non-compete clauses may not be enforced in California, since they restrain your ability to earn a living. That said, companies sometimes will go after former employees, claiming they stole trade secrets, including customer lists.
I see no basis for them to sue your new employer, especially since the product -- although similar -- is produced differently, and the company has stopped producing it altogether. However, not having a basis never stopped one from threatening.
Re: Non-Compete and Incorrect Sales Commissions
If they are threatening, you should worry. If you have a claim for unpaid compensation, you can bring an action with the Labor Commissioner. If you hire an attorney to help you, he should be able to convince the ex-employer to stop threatening your new employer and you. If that continues, you could get fired. Contact me if interested in discussing your options.
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