Legal Question in Employment Law in New York
Non-compete clause between two subcontractors
I'm currently under contract to a subcontractor, who pays my salary, and 1/2 health benefits, to provide tech support for a company (heretofore referred as the client.)The client is moving operations to headquarters in another state. I had informed my present subcontractor, months ago, of the impending move, and asked them to find me another job. They continually said they were trying, but due to the economy, no jobs were available for someone with my qualifications. Later, the client said that for tech reasons, it was necessary to leave one customer at the present site. The client hired another contractor (who has specific tech. knowledge of the installed equip) to run the operation. I interviewed with this new contractor and was given a job to stay on. Two business days before I was to start with the other subcontractor, my contractor called me to say that they were going to exercise their noncompete clause (clearly in my contract), and I could not work with the new contractor. My current contractor has provided absolutely no training; all training was by the client. Do I have any options? What if I ignore the clause, and work for the new contractor anyway?
2 Answers from Attorneys
Re: Non-compete clause between two subcontractors
The law on this is not clear in New York and depends on a lot of factors and good or bad faith. If in fact no training was provided, that is merely an argument. However, if your sub contractor, with whom you have the contract, has not been able to place you somewhere else, that could be a plus in favor of equitable relief from the non compete clause. Otherwise, hey, people are usually bound by what they agree to under duress or not. However if you had no part in drawing up the contract, it will be construed in your favor and least favorably against the draftor, your subcontractor-employer. That could also help. This whole subcontractor/contractor stuff is nonsense designed to avoid putting you on a payroll and having to withold and pay FICA and health and pension benefits once they accrue to " employees". One of these days the IRS is going to put a complete stop to it.
Re: Non-compete clause between two subcontractors
Do you have a written contract? This is a complex fact pattern which is better discussed in person than via email. My phone number is (212) 867-4751.
-Brendan
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