Non Compete Agreement with Employer

[kkpr]

I am a software engineer. My current client where I work currently, has informed my employer (ABC,Inc) that they were not going to extend the current contract after 9/30/2007. So ABC,Inc will have to place me somewhere else, which is very unlikely. So looks like ABC,Inc will let me go. So I have to find another job after 9/30/2007. I work on EAD so I can change employer.

The current client has opened a contract for bidding for the position currently I am working on. I have registered my company in January 2007. As per the contract requirement I (my own company) am eligible to bid for a contract and chances are I can win it.

I have a Non Compete agreement with ABC,Inc which is as follows:

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"COVENANT NOT TO COMPETE: Employee agrees that he/she during the course of Employee's employment or for a period of three(3) years commencing upon the expiration of his/her employment, will not for any reasons whatsoever, directly or indirectly, individually or on behalf of persons not now parties to this agreement, or as a partner, stockholder, director, officer, principal, agent, employee or in any other capacity or relationship, engage in any business or employment, or aid or endeavor to assist any business or legal entity or any ABC,Inc customers being supported by the employee to compete with ABC,Inc.

ABC,Inc and Employee acknowledge the reasonableness of this covenant not to compete and the reasonableness of the geographic area and duration of time which are a part of said covenant."

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Important: In my current contract, in last two years about 6 to 7 ABC,Inc employees who had the same agreement with ABC,Inc, have joined my current client as government employees for the same position they used to work. Currently I am the only ABC,Inc employee left in this contract. ABC,Inc has let all other people join the government without any problem.

Here are my questions:

1. Can I bid for this new contract?
2. If I bid and win the contract can ABC,Inc come after me?
If "Yes", then
a. What can ABC,Inc do?
b. How does it affect my Green Card process?
c. What are the consequences of breaching the non compete agreement?
3. In what circumstances this non compete agreement is void?
For example:
a) If ABC,Inc does not bid for this new contract at all.
b) ABC,Inc is unable to provide me employment after 9/30/2007
4. What could be the solution if the non compete agreement does not allow me to bid the contract?

Your advice will be highly appreciated.

Thank you,

 

[user55]

I did thorough research on self employment while on H1 and I found that you can NOT create a company, sponsor your own H1 and employ yourself. This would be illegal and INS could come after you.

but then again I have heard unreliable stories that people have done it before.

 

[kkpr]

Actually I am not on H1 visa any more. I am working on EAD. I checked with my lawyer and a few other lawyers. I can start my own company and can work for that company. But my question is about the non-compete agreement. Can somebody answer it?

Thank you,

 

[Dallas03096]

It is obvious that you will be violating the non-compete agreement, if you bid for the position with your end client. Depending on your risk taking capability, you can decide to do that and face legal consequences from your current employer!

 

[ajiabs]

If you bid against your current employer for the position they placed you, you will be violating the Non-compete agreement. So your employer can come after you, meaning sue for damages. I don't see how it will impact your green card processing, unless its sponsored by the company competing against. Non compete will not be void in neither of conditions you mentioned. But they are unlikely to come after you, if they are not bidding.

Best option is talk to your employer. If the client is not renewing the contract means, they are not happy with your employer. so they would be unlikely to be interested in bidding.

Good luck