Legal Question in Business Law in Minnesota
Situation: Company "A", which hired an Independent Contractor "B" for services, has terminated their contract. Company "A" has hired a new Independent Contractor "C". Independent Contractor "C" seeks to hiring the Independent Contractor "B"s managers directly, but the Independent Contractor "B" has laid off all managers and notified them that they cannot be hired by Independent Contractor "C" due to an agreement the Independent Contractor "B" claims the laid off managers must abide by. According to the laid off managers, they have not signed such an agreement and contemplate whether they must legally comply with this agreement(see below). The agreement was signed between Company "A" and Independent Contractor "B".
For a period of one year following the expiration or termination of (i) this Agreement, and (ii) any extensions or renewals thereafter; Company A shall not directly or indirectly employ, contract, hire, solicit, consult with or in any way have any contact or connection with any person(s) that were employed or contracted directly or indirectly by Independent Contractor "B" in a position of supervisor or above including but not limited to lead valet, supervisor, manager, director, etc . . . to perform services, directly or indirectly, for the operation of the Premises without the express written consent by Independent Contractor "B". Notwithstanding the foregoing, Company A retains the right to directly or indirectly employ, contract, hire, solicit, consult with any person(s) that are or were employed or contracted directly or indirectly with Independent Contractor "B" who were not in a supervisor or higher position.
1 Answer from Attorneys
I don't believe the former "B" managers would be bound by this agreement, if they themselves never signed off on a noncompete agreement. "A" could face some exposure if "B" can successfully argue that hiring these managers through "C" is an "indirect employment" of the former "B" managers.
Standard disclaimer: The comments above are based on limited facts and should not be considered legal advice. We do not have an attorney-client relationship. That said, good luck to you and let me know if I can be of further assistance.
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