Letter from work, Need Advice!

[dewd]

my friend just got this letter today "november 18,2005" and he wants to know what to do with it, if he should sign, or not sign, or quit

my friend has worked for this company for over a year,
my friend works at this company full time and makes below minimum wage


would they win in court if they go after you with this letter?
is this letter valid due to the date on the letter?
does he have to sign this?

what do you guys think of the letter? would you sign it?

letter screenshots
http://myspam.org/letter/PAGE1.JPG
http://myspam.org/letter/PAGE2.JPG

 

[Wolfman]

That's a pretty harsh contract, pretty unfair if you ask me. Add in the fact (if factual) that he's not even making minimum wage, I'd sign it with a not so humble "**** YOU - I Quit"

 

[dewd]

my friend started a project that will benifit the company greatly, and he registered 2 domains in october that the company likes alot

the domains/website is in the same line of the company business

thats why i think the augest date is there, so the company can take the website/domains away.......but the domains are in his name

thats why my friend asked me for advice on this, i should have mentioned that in first post

 

[DNQuest.com]

This happened to me once, I was at a company for 4 years, then they decided to make me sign a no compete. I did not sign it. I argued that they are giving me condition for employment, but I was already employed. I told them I will not sign away my lively hood. I was told that a no-compete must be signed before employment is given becuase it is a condition of employment. Now if I was promoted to a higher position, then they could make me sign one if I wanted the position. I may be wrong here, but I don't think they can fire you for not signing a no compete if you are already employed with the company.

Hopefully someone will ring in.

As far as the domains names, if he registered it for the company while he worked for them, it is the company's domain, not his. He was paid to do a job which he did, so his work becomes property of the company.

I believe the no-compete is too vague and general and too long. It is saying you can't sell anything on the internet, ebay or mail order, I am sure that these are not the company's trade secrets they don't want you to perform

 

[dewd]

the domain/website was my friends hobby, and it got popular and the company has advertising all over it, and it leads to alot of business for the company

 

[DNQuest.com]

You said he registered the domains in October, so the question would be, was he paid to do it? or did he do it on his own time and resources and the company wanted to use it? Who decided to do the project? Did your friend start it on hos own and the company like it and used it. Or was it developed during his employment?

There are other questions too, but that's a start...

 

[IAmAllanShore]

Non-compete covenants... the joy. My answer, in brief (Of course with a NC tint, but it follows most of the US):
Covenants not to compete are typically viewed with disfavor, as they restrict the ability of individuals to work and engage in commerce. However, this disfavor has been balanced with a desire to allow individuals and entities to contract knowing that what is promised will be fulfilled or suffer the consequence of law. As well, the court has realized that many times the employer does have a legitimate interest in protecting their business when an employee has gained a personal hold on the employer’s clientele. Manpower of Guilford County v. Hedgecock, 42 N.C. App. 515, 522, 257 S.E.2d 109, 114-115 (1979). If an employer wants to enforce a covenant not to compete, the employer has the burden of affirmatively showing the five requirements for a covenant to be enforced. Kadis v. Britt, 224 N.C. 154, 158, 29 S.E.2d 543, 545 (1944). The five requirements are that the covenant not to compete must be: 1) in writing; 2) reasonable as to time and territory; 3) made a part of the employment contract; 4) based on valuable consideration; and 5) not against public policy. Statesville Med. Group, P.A. v. Dickey, 106 N.C. App. 669, 672, 418 S.E.2d 256, 258 (1992).
In other words: more information is required.
-Allan

 

[Oblivion.]

In short... No.

From what you've said about your friends hobby (and it's in the same line of business), they've just done this to snatch those sites from him, as it's the sort of contract that should have been signed when he started working for them. I'm guessing it was around August 2005 that he registered the domains or started the websites? These types of contracts are often given to new employes to sign when they start in a business where they hold large user databases etc, otherwise employes could take the databases and use them for their own use.

Looks like the company he's working for should have given this to him at the start, if he doesn't sign it I think he'd probably get sacked without much of a reason, if he signs it he'll get sacked if he continues to run his hobby sites. He could just 'borrow' the databases where he's currently working, and quit to carry on his Hobby sites, but a big list of potential customers, and then if that doesn't get him by (money-wise), he could try and get another job that does meet the minimum wage.

Just IMO *shrugs*

 

[dewd]

thanks for all your input on this letter, i have told him all your comments and he really appreciates this

 

[deu12000]

I think they can fire him for not signing it. They might not blatantly fire him but they might set him up for failure to terminate him. That is a rough non-compete agreement. Where I work I signed a one year non-compete clause. I don't know if a five year non-compete is legal, it seems to be a very long time.

 

[resellerlogic]

If he's getting below minimum wage. He's dumb for even working there. And that company could be sued big time for that.

 

[IAmAllanShore]

If he's getting below minimum wage. He's dumb for even working there. And that company could be sued big time for that.

For doing what? Protecting their legitimate business interests through a Non-compete?
Hyperbole is fun, but be careful.
-Allan

 

[Stephen]

I would simply give up the domains and see if that is enough to satisfy them.

I personally would not sign the letter, as five years is much longer than the normal "non-compete" agreement.

If he is indeed making below minimum wage, and you can show viable proof of that in court, I don't see why you wouldn't win at least on that part..

The company should be reported for this, imho.

There are strict laws against paying below minimum wage...

For doing what? Protecting their legitimate business interests through a Non-compete?

Hyperbole is fun, but be careful.
Allen

I believe he means for hiring employees under minimum wage, which isn't legal.

Stephen

 

[Xyzer]

I would do pretty much the same as stephen, just give the damn domains to them

 

[2cworth]

I'm not a lawyer - the first suggestion therefore is run any of my suggestions by a qualified / good lawyer before acting on them.

Some details are not very clear here, so you'd need to check these elements out.

1) Can he prove that he paid for / developed the domains on his own, and did not use any of the company's proprietary information (users, specifications etc.). If he did, there's no way the company can grab the domains. The maximum they can do is stop advertising.

2) Re. the advertising - did they pay for it? If not, what was the arrangement? That in itself may help show that the ownership is his.

3) The non compete contract by itself looks too vague. My choice would be to quit rather than accept, and maybe use the hobby domains with some other company in the same line - if it's generating value for the company, you can bet that another competitor will be interested. However, this may or may not be in line with your friend's line of thinking.

4) If he's not wanting to quit yet wants to retain the sites, has he explored modifying the contract + the signing date - maybe do it with a December signing date? And specifically excepting the existing websites? If he hasn't signed anything yet, a post facto contract may not hold - but explicitly specifying it helps.

On the other hand - if his title to the sites either by way of domain registration or by way of site content look shaky, then its far better to hand it over than go through the legal hoops. A lawyer is the best person to comment on this.

Hope this helps