Friend Got A New Job - His Former Boss Is Trying To Collect A Five Figure Buy-out Fee From A Non Compete Clause At His Old Job
Hi all,
I'm just trying to hopefully help out my friend. He just got a new job and the old job apparently had a non-compete clause thrown into the employment contract. This is in Pennsylvania.
Is he actually going to have to pay the former employer 50% of his annual compensation to switch jobs?
Some details about the jobs:
Old job was a company located in PA. New job is a company headquartered in a different state with no brick-and-mortar offices in PA. (Job is a tech job that is work-from-home).
My friend's role at the new job is slightly different in that the old job was more upgrades and new one is more implementation (of the same general software).
No known specific client overlap since there is a difference between implementation vs. software upgrades.
Here is the Non Compete Clause referenced in his letter from his old employer trying to get the buy out:
At the end of the employment period, by expiration or termination, you may not engage, manage, operate, own, or be employed by a business similar to the type of business conducted by the company or a client of the company for 2 years. If you break this contract, the clause can be released if approved in writing for a buy out fee of 50% of your annual salary. If the employee breaches this contract, the company is entitled to a restraining order and injunction preventing the employee from violating these provisions. Nothing in this agreement prohibits the company from pursuing any other remedies for a breach including recovery of damages from the employee themselves.
Is my friend pretty screwed here? He has already received a letter from his old job's legal department trying to collect the buy out.
Thanks for any help.
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