Q&A: Is my non-compete agreement binding 15 years later?

| August 4th, 2015 | No Comments »

QUESTION

A contract is a document drafted by the employer and signed by their respective employee. It is up to the employee to review this document and, if in agreement with the content, the employee signs it away, binding them to those terms. One particular clause that comes up often during discussion is the non-compete agreement.

A non-compete is a form of restrictive covenant drafted by the employer which restricts the employee from working for another industry. Let’s say an employee signed a non-compete 15 years ago and was not given a copy. Readers from the Globe and Mail would like to know, can the employee be bound by this agreement today? Or does he/she need to sign every so often to make it valid?

ANSWER

The Non-Compete Agreement

Well-known Globe and Mail columnist for the Report of Business and Toronto Employment lawyer, Daniel Lublin answers this question with his expertise. He says that non-compete agreements do not need to be renewed, unless stated otherwise in the contract. It is also worth mentioning that the agreement is not deemed invalid simply because the employee did not receive a copy of the agreement. An employer can rely on this document regardless.

To find out more on this topic, read Daniel Lublin’s column and full article I have to work through my severance. Is this legal?

Common Employment Law Questions

| December 8th, 2008 | No Comments »

Question:

If working in a salaried position and being in sales (during a time of low sales) can your employer "pull salary" away from you and place you solely on commission effective immediately, even if there is an employment contract signed stating the annual salary?

Answer:

Your employer cannot unilaterally change your compensation structure in a severe way. There are many cases that state going from salary to commission is a real and substantial change to your compensation such that you can consider this action as amounting to your dismissal. In other words, you can reject the change and look for other work or you may be able to simply leave and claim you were dismissed. You could then sue for damages for your economic losses while you are out of work.

As this area of the law is quite complex and your election is important, I would recommend meeting with an employment lawyer who can explain your rights to you in greater detail and build a strategy that best fits your particular situation.

For more information on constructive dismissal situations, like the one above, please see my free employment law advice page on constructive dismissal, here.

Daniel A. Lublin is a Toronto Employment Lawyer specializing in the law of wrongful and constructive dismissal. He can be reached at dan@toronto-employmentlawyer.com.

UK Haidresser losses job after shaving profits from employer

| November 21st, 2008 | Comments Off on UK Haidresser losses job after shaving profits from employer

Mark McMorrine will likely be styling hair in prison for the next 18 months.

The Lasswade, Scotland hairdresser was recently convicted of theft and fraud stemming from a scheme in which he stole equipment from the salon which employed him and sold it via his eBay account. It is reported that McMorrine netted more $125,000 from the sale of the items which ranged from flattening irons to posh shampoos.

Theft from one’s employer has long been regarded as cause for dismissal. In McMorrine’s case, he lost both his job and his freedom. Please visit Canadian Employment Law Today for more on this story.

Daniel A. Lublin is a Toronto Employment Lawyer specializing in the law of wrongful dismissal. He can be reached at dan@toronto-employmentlawyer.com.

Daniel A. Lublin, Toronto Employment Lawyer, wins suit without calling a single witness

| October 1st, 2008 | No Comments »

In a recent Ontario Superior Court decision, Adjemian v. Brook Crompton North America, 2008 CanLII 27469 (ON S.C.), Daniel A. Lublin successfully argued for and won a Motion for Summary Judgment, effectively winning the case without calling a single witness.

As reported in the Canadian Cases on Employment Law (67 C.C.E.L. (3d) 118), Justice Perell awarded a judgment in favour of Ms. Adjemian for damages stemming from her wrongful dismissal amounting to $61,944.65 plus pre and post judgment interest and legal fees.

Daniel A. Lublin is an employment lawyer focusing on the law of dismissal. He can be reached at dan@toronto-employmentlawyer.com.


KPMG class action settled

| September 24th, 2008 | No Comments »

Major accounting firm KPMG has recently settled the class action lawsuit launched on behalf of employees who claimed damages for unpaid overtime.

The settlement, expected to be worth about $10 million dollars, was announced last week. Employees now have until September 30th to claim their portion of the settlement.

Unfortunately for the employees affected by the claim, they now have another hurdle to jump before they can recoup damages. The employees must now prove that they fall into the class that has been awarded the damages.

As I ‘ve stated in my previous post regarding the current Scotiabank and Bell Canada mass torts, a class action lawsuit, while appropriate for overtime and pension claims, may not always be in the best interest of the plaintiffs or may not be particularly practical in mass dismissal claims.  In wrongful dismissal claims, class actions habitually fail to consider the individual employee’s mitigation efforts, they regularly force a broad application of the Bardal principles, and there is often a duplication of work on client files. 

Daniel A. Lublin is a Toronto Employment Lawyer focusing on the law of wrongful dismissal.  He can be reached at dan@toronto-employmentlawyer.com or visit www.toronto-employmentlawyer.com

Don’t be too quick on the trigger with the send button.

| September 16th, 2008 | Comments Off on Don’t be too quick on the trigger with the send button.

As reported by the Toronto Star, Rick Sullivan sent an email to pal Jason Wade regarding rumours about former co-worker, Ronald Harrington.  The contents alleged that Harrington was dismissed from his previous employment for “cooking the books”. Wade, director of operations for WesTower, Harrington’s new employer, shared the email with Harrington. The email was eventually shared with George Patton, Harrington’s previous employer and the person Sullivan alleged to have fired Harrington.

Harrington claimed that the contents of Sullivan’s email were defamatory and resulted in stress and panic attacks. The suit was settled out-of-court for about $7,800.00.   

The underlying principle of this matter is that sending a malicious email, even if only addressed to one person, can have a much broader touch that ever imagined.  Many people who use email do not consider that the service essentially keeps a written record of all correspondence. As Harrington did, many of my clients often rely on email records to support their claim.

The lesson learned here, as I have mentioned in my weekly column several times, when dealing with electronic communication, employees and employers should always observe the following advice;

1. Thoroughly review and follow any workplace computer and Internet misuse policies.
 
2. Exercise caution when communicating with or providing advice to clients or colleagues.   

3.  Allow common sense to prevail.

Daniel A. Lublin is a Toronto Employment Lawyer specializing in the law of wrongful dismissal.  He can be reached at dan@toronto-employmentlawyer.com or visit www.toronto-employmentlawyer.com

Employers limiting limitations; Where’s the consideration?

| July 22nd, 2008 | No Comments »

American employers have begun to ask new employees to sign a waiver which effectively reduces the limitation period for employment law claims to 6 months after the loss.

Our friends at Law.com recently reported how DaimlerChrysler Corp. won a battle to enforce such an agreement. Mee Sanders was denied portions of her claim against her union and ex-employer because the Court ruled that Sanders waived her legal right to a 2 year limitation period when she applied for the position, thus reducing it to a 6 month limitation period.

The clause that Chrysler relied on, shown below, is brought to the attention of all applicants during the job application process.

In consideration of Chrysler’s review of my application, I agree that any claim or lawsuit arising out of my employment with, or my application for employment with Chrysler Corporation or any of its subsidiaries must be filed no more than six (6) months after the date of the employment action that is the subject of the claim or lawsuit. While I understand that the statute of limitations for claims arising out of an employment action may be longer than six (6) months, I agree to be bound by the six (6) month period of limitations set forth herein and I WAIVE ANY STATUTE OF LIMITATIONS TO THE CONTRARY.

In Canada the enforcement of a similar clause is doubtful.  Canadian courts will not enforce contractual clauses that provide employees with less than their statutory entitlement.  In other words, if the clause is viewed as illegal, it is void for public policy reasons. 

While Canadian employees can agree to limit their entitlements to less than they would receive had there been no clause in their contract, there are still various tests that must be met in order to enforce such a clause. 

Daniel A. Lublin is a Toronto Employment Lawyer practicing in the law of wrongful dismissal.  He can be reached at dan@toronto-employmentlawyer.com or visit www.toronto-employmentlawyer.com

Cross dressing judge ends quest to rescind resignation

| June 4th, 2008 | No Comments »

Last February U.S. Judge Robert Somma was arrested and charged with driving while intoxicated. Clad in a women’s dress, stockings, and pumps, his arrest led to much media scrutiny. Two days after pleading no contest to the charges, Mr. Somma tendered his resignation to the court system, giving them 2 weeks notice.

Once his 2 week notice period was nearing it’s end, Mr. Somma started the wheels in motion to rescind his resignation.  His attempt to be reinstated was accompanied by over 200 lawyers who sent letters in support of Somma.  His notice period was extended another month, however, his quest for reinstatement ended on May 30th with the court issued press release stating that Somma is "leaving to pursue other endeavors".

Rescinding a resignation is possible in certain circumstances. In my September 2007 article, True resignation is voluntary, I noted that employees are sometimes free to withdraw a resignation and continue as before.  This would be subject to whether or not the employer had ‘accepted’ the resignation by its actions or conductSee the case of Andrew Kieran for more.   

Daniel A. Lublin is a Toronto Employment Lawyer specializing in the law of wrongful dismissal.  He can be reached at dan@toronto-employmentlawyer.com or visit www.toronto-employmentlawyer.com

Termination for toonie theft upheld

| June 2nd, 2008 | Comments Off on Termination for toonie theft upheld

Nine years after being caught on camera for stealing a toonie from her employer, Tim Horton’s, Charlene Walsh may now have some answers about her termination.

In 1999 Walsh was fired with cause for the toonie theft which was caught on the company video surveillance. In one way or another, her case has been struggling through the Courts since that time. 

Last week, the Court unanimously found that Ms. Walsh’ most recent appeal, headed by her counsel Ernest Guiste, had no basis to revisit the jury’s 2006 finding, which dismissed Walsh’s $10-million lawsuit against Tim Horton’s and the Toronto Police, alleging wrongful dismissal and malicious prosecution. 

The National Post reported that Mr. Guiste argued that the police improperly charged Walsh because they received free coffee from Tim Horton’s.  She was also acquitted of the criminal charge. 

To read more about this matter, click here for today’s National Post article.

Daniel A. Lublin is a Toronto Employment Lawyer specializing in the law of wrongful dismissal.  He can be reached at dan@toronto-employmentlawyer.com or visit www.toronto-employmentlawyer.com

Don’t be too quick to sign

| March 26th, 2008 | Comments Off on Don’t be too quick to sign

This is the cautionary tale of two cases that reveal the fate of employees too quick to sign their names…

In Barr v. Pennzoil-Quaker State Canada Inc. the court ruled that the deal was less than what Barr could have received and was "unfortunate". However, it was not so bad that it was prepared to set it aside.

In Titus v. William F. Cooke Enterprises senior Ontario lawyer Douglas Titus was dismissed by William F. Cooke Enterprises and immediately agreed to its offer of severance. Titus read the termination documents at the meeting, including the release, which states in bold, capitalized letters: "I have read this document and I understand that it contains a full and final release of all claims … I am signing this document voluntarily."  Titus signed his name and left with a cheque in his pocket.  Later on he sued, claiming the release was signed under duress and the deal he received was less than fair. But Titus, a lawyer for more than 20 years experience, with self-professed experience in employment law, couldn’t convince the court that the deal he signed was so unfair it should be invalid.  According to the court, "with eyes wide open", he declined both opportunities, preferring to immediately accept the package instead.

These cases provide a stark message for employees when confronted with an offer of severance on an ironclad release: Fair or not, seldom will a signed document be set aside. Employees can avoid this result by observing the following advice:

Like any commodity, a termination package is usually negotiable. Seek specialized counsel before signing your name.

Duress, coercion or unconscionability are not easily proven – especially when the employee is given time to consider the offer. 

Ask for more time or the opportunity to meet with a lawyer if the terms of an offer or release are unclear.

Daniel A. Lublin is a Toronto Employment Lawyer specializing in the law of wrongful dismissal.  He can be reached at dan@toronto-employmentlawyer.com or visit www.toronto-employmentlawyer.com