Customer (name blocked for privacy):
The answers for 1,2,3, and 4 are pretty much the same.
Chic Cuts had all employees sign a non-compete agreement and can file suit to enforce the agreement.
Whether you quit or are fired, a non-compete agreement will bind you to not work for another salon or open a salon that is in competiton with Chic Cuts.
Chic Cuts' non-compete agreement is not reasonable, however, because a term of 5 years anywhere in the state of NY means they are completely forbidding a person from earning a living in their chosen profession. However, an employer can negotiate with employees to prevent employees from learning about their business and then leaving and causing harm to their old employer by stealing clients. Because in questions 1,2,3, and 4 all employees went to work for salons right near Chic Cuts or opened a salon right near Chic Cuts (even in a basement this business is competing), although the Chic Cuts non-compete agreement is unreasonable in the number of years and the geographic location it covers, the court can modify it to be reasonable, say to an area within 5 miles of Chic Cuts and for a term of 1 year. So, because Alice, Barbara, Claudia, and Dawn all got jobs within days of quiting or being fired, or tried to compete with Chic Cuts within blocks of it, Chic Cuts will likely be able to use the non-compete agreement to stop them. With Claudia, even if she did not advertise she breached the non-compete and Chic Cuts can also try to close her down if she failed to obtain proper permits or licenses to open the salon in her basement. As for Dawn, Chic Cuts can sue her for negligence for her actions.
Questions 5
Because although the non-compete agreement was for 5 years and covered the entire state of NY, it will likely be found unconscionable and be altered by the court to be more reasonable. However, to hold Ellen to this agreement, even after the court can modify it to say 1 year and 5 miles surrounding Chic Cuts would still make Ellen free from the terms of the agreement after a period of say 4 years (average college term). Chic Cuts cannot prevent Ellen from working for the nearby salon.
Question 6
Again, the non-compete agreement is too long in years and covers too much geographic area than it needs to in order to serve its purposes of protecting Chic Cuts. Because the court will likely modify the non-compete agreement to no more than 1 year and perhaps 5 miles from Chic Cuts, Fran will be able to take a job in Watertown.
Please let me know if you need more detail for each question.
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PLEASE NOTE: Responses here are for information/education only, NOT legal advice and do not form attorney-client relationship! Only licensed attorneys you hire in your state can provide legal advice.
