Legal Question in Business Law in Pennsylvania

First, I assume you have no "non-compete" agreement with these people. I would terminate them immediately, because they are going to compete against you for clients. In the event that they do contact your present clients to enroll their children, I think that you you would have a good case against them for intentional interference with contractual relations between you and your present clients. I see no benefit to you in keeping them as employees, unless they agree to sign a non-compete agreement NOW. I would give them the option of signing a non-compete agreement in exchange for their continued employment by you, If they won't sign it, let them go. Right now, they obviously need their jobs, because they don't have a site, appropriate licenses and furniture and other items they will need. So I would use that as leverage to sign a good non-compete agreement, which should be drafted by an attorney for a relatively small fee. Such an agreement gives you added protection should they become your competitors.