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Alex J.
Alex J., Solicitor
Category: Law
Satisfied Customers: 3844
Experience:  Solicitors 2 years plus PQE
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I am an UK ltd company that provide Sales and Business

Customer Question

Hi, I am an UK ltd company that provide Sales and Business consultancy to US based startups. One of my USA clients has received a letter from one of my "employees" previous employers UK legal counsel stating he has a non compete cause in his contract. I am aware of the non compete and have gated his functions so he is not talking to his previous clients until his non compete has expired on the 26th of May, even though we are not competitive with his previous employment. As they have wrote to my client incorrectly assuming my employee is their employee, what is your suggestion to resolve the issue.
Submitted: 2 years ago.
Category: Law
Customer: replied 2 years ago.
I have attached the letter. Just to be clear the person names is an employee of my UK Ltd company not ThreatConnect Inc. They are also asking for his employment to be terminated.
Expert:  Alex J. replied 2 years ago.
Hi, Thank you for your question and welcome. My name is ***** ***** I will assist you. How long until the non compete clause expires? Has this done damage to your relationship with the US Client? Will the US Client co operate with you on this matter? Having looked at the undertakings, I can see absolutely no issue in the US Client signing these - they have no merit and also as the employee is not employed by the US company anyway, the US company is not actually in breach of the non compete clause. I look forward to hearing from you. Kind regards AJ
Customer: replied 2 years ago.
The non compete expires on the 26th of May. This has affected my client relationship and will potentially cost me money to resolve. Also both mine and the clients business is non competitive and i understand that the CNC's would be difficult to enforce in the UK unless this person was a key employee of which he was not. Should I contact the plaintiffs legal counsel in the UK?
Expert:  Alex J. replied 2 years ago.
Hi, Thank you. The problem with contacting the Plaintiffs legal counsel is that you could potentially be joined in any proceedings if they choose to sue the employee, as you have allowed the employee to breach the clause. On the other hand, if you owned up and explained what has happened they may just ask you to sign the same undertaking - which I believe would be fine to sign in any event. If they knew it was you (and not the US company) - would they be more likely to sue you?
Customer: replied 2 years ago.
But we haven't breached the non compete. We are not even in the same space as previous employer and he hasn't exposed any confidential data and we have asked him not to visit any previous clients until such time the non compete expires in May.
Expert:  Alex J. replied 2 years ago.
Hi Thank you. If that is the case, and it helps to repair your relationship with the US client, then yes I would contact the legal counsel and confirm the person is employed by you. If they then ask you for an undertaking on similar terms, I would just give it to them if it avoids you having to rack up legal fees. How was this employee introduced to you? Kind regards AJ
Customer: replied 2 years ago.
The employee approached me for employment directly.
Expert:  Alex J. replied 2 years ago.
Hi, Thank you. If you are not competitive with his old employer and do not provide similar products and services, then this non compete will not apply. As you have noted, this probably wont be enforceable in the UK anyway especially if the court deems it too restrictive and stops his ability to earn a living. Will approaching the legal counsel actually repaid the relationship with your client?
Customer: replied 2 years ago.
The employee found us through a job advertisement.
Customer: replied 2 years ago.
Yes, I think my client relationship is ok. They are going to respond as they have been advised to confirm he is not an employee of my client.
Expert:  Alex J. replied 2 years ago.
Hi, Thank you. As you are not a competitor, did not poach this employee, or approach him directly then you are not at great risk of being sued under this none compete clause. If your client is happy to deal with the matter, then I see no reason for your to contact this legal counsel. Ultimately a non compete clause has to have a commercial purpose, it cannot be used to stop someone earning a living. The commercial concern seems to be protecting confidential information, not stopping someone from working - if this is the case then the company has its confidentially clause to enforce against this employee. Any claim for breach of a non compete clause by his new employer (i.e you) would seemingly have little merit or purpose, especially as you are not a competitor - and their interests are protecting by confidentiality obligations.