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Taking the right steps when leaving a company for a competitor can depend on where a non-compete agreement was signed. (iStockphoto)
Taking the right steps when leaving a company for a competitor can depend on where a non-compete agreement was signed. (iStockphoto)

ASK AN EMPLOYMENT LAWYER

Can my employer stop me from working for a competitor? Add to ...

THE QUESTION

I am, and have always been, a sales representative. I have certain accounts where my relationships are very strong and the clients have said they would transfer their business to me should I leave my company for a competitor. Other than my knowledge of the accounts and their usage, there is no proprietary technology involved. You could compare it to a sales rep for Ford going to GM. My question is: Would I be subject to legal repercussions from my current company if I left for a competitor?

THE ANSWER

Did you ever sign a non-compete or non-solicit? This is the first question a court would consider. If you did, were those terms drafted and implemented in a manner that a court will respect? Many judges will overlook unfair or unreasonable contractual language especially as it relates to competing with a former employer. Next, if there is nothing in writing stopping you from competing, you can freely do so as long as you do not misuse any confidential information. There is one further exception. In limited cases, employees who are in key roles can be characterized as a “fiduciary” by a court. In this scenario, courts can impose postemployment restrictions on competing or soliciting clients, even in the absence of a contractual clause. Ordinary sales representatives can be fiduciaries but only in exceptional circumstances.

THE QUESTION

Are contractors entitled to any legal protection if they have been terminated for disclosing their pay to another contractor?

THE ANSWER

Possibly. Sometimes your compensation is strictly confidential but an employer must make this point absolutely clear, especially if you are not technically employed and are working as an independent contractor. If an employer cannot show that you were told or ought to have known to keep details of your pay to yourself, it will be difficult to justify disciplining you for sharing it.

THE QUESTION

I was recently promoted to a new position and with it, given a new contract, which I signed. Outlined in the contract, I was eligible for benefits, sick, personal and paid vacation days that I did not have before. After three months in the new role, my manager approached me and explained that the contract I was offered was incorrect and that the new role was intended to be a contract position, without any of these benefits. Is this fair? If not, what is my best plan of action to ensure that my employment rights are not compromised and that I get the benefits that I originally signed for?

THE ANSWER

An error this big is seldom by mistake and it is even less likely that a court would set this contract aside.

Both employers and employees make bad deals all the time – but this does not give one or the other the right to walk away if they don’t like how it turned out. Therefore, you should insist that the employer comply with the agreement that they made, or give you something of equal value, such as a raise or bonus in exchange for losing the benefits and other perks.

If the employer is unprepared to negotiate, you can consider this a violation of the contract you made, and you can either bring a court claim while still employed to compel payment for the lost benefits and perks, or you can leave the workplace and sue for lost wages and these benefits while you look for another job.

Get specific advice about which strategy works best for you in this situation.

Daniel A. Lublin is a partner at Whitten & Lublin, representing both employers and employees in workplace legal disputes.

E-mail: Dan@canadaemploymentlawyer.com

Have a question about careers, labour law or management? Send it to our panel of experts: careerquestion@globeandmail.com Your name and address will be kept confidential.

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Follow on Twitter: @danlublin

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