Non-Competition and Non-Solicitation Clause Primer | Employment Law Show TV – S5 E23

Episode Summary

NON-COMPETITION AND NON-SOLICITATION CLAUSE PRIMER, severance for short service employees, contract expiring, and more on Season 5 Episode 23 of the Employment Law Show with employment lawyer Lior Samfiru, Partner at Samfiru Tumarkin LLP.

Watch above to discover your workplace rights and learn everything you need to know about employment law in Ontario, British Columbia, and Alberta, on the only employment law show on both TV and radio in Canada.

Episode Notes

New employment during a layoff period

I’ve been laid off for a long time due to COVID-19. My layoff keeps getting extended. I found another job, still hoping I’d be recalled to my previous job. my former employer found out and he considered this my resignation. Is this true?

Employees who are laid off can treat the lay off as termination and can pursue their severance entitlements. Employees who have been laid off, cannot be considered to have resigned from their employment.

Segment starts at 2:08

CALL: Laid off after a demotion

After working in a full-time position for four years, my employer demoted me to a part-time role four months ago. I have just been laid off. Should my severance be based on my full or part-time pay?

Employers do not have the right to reduce or change the employment status from a full-time employee to part-time employment. Employees do not have to accept fundamental changes to their employment. By accepting lower compensation, employees are potentially decreasing their future severance entitlements.

Learn More
Constructive Dismissal
COVID-19 layoffs considered constructive dismissal

Segment starts at 6:47

Terminated after requesting for personal days

I was let go after 5 years with my employer. I believe my firing was tied to the fact that I asked for 2 personal days following a month of endless 12-hour shifts they asked me to work temporarily. After asking about my mental health, they sent me 4 weeks’ pay and said that I should have no problem securing a new job. Can they do that?

Employees who have a mental health condition cannot be let go or penalized for having a condition, as it is a human rights violation. Employers cannot let employees go as a result of their disability. Employees should also remember that full severance entitlements are calculated based on the age of an employee, as well as the length of employment and position.

Segment starts at 9:17

Non-Competition and Non-Solicitation Clause Primer

1️⃣ What is a non-competition clause?

A non-compete clause is a term in a new employment agreement that states if an employee leaves the company they cannot work for a competitor for a general period of time. This is a common term but it could significantly impact an employee’s ability to find future employment.

Segment begins at 12:48

2️⃣ What is a non-solicitation clause?

A non-solicitation clause states that if an employee leaves their employment, they cannot pursue their former company’s clients or customers. This clause protects a company’s client base and is fairly common in an employment agreement.

Segment begins at 13:58

3️⃣ Are these clauses enforceable?

The non-competition clause is typically not enforceable as courts state it prevents employees from future employment. A non-solicitation clause, however, is usually enforceable and employees should abide by it in order to avoid legal trouble.

Segment begins at 15:14

4️⃣ Should an employee ignore a non-competition or non-solicitation clause in their contract?

Employees should try their best not to ignore the clause as employers can still try and force the clause and pursue legal action.

Segment begins at 16:38

5️⃣ What should somebody do if they want to work for a competitor, but have a non-compete clause?

Employees should inform their new employer of a non-competition clause in their previous employment. Employees should also consider communicating with their previous employer and address their concerns.

Segment begins at 18:23

6️⃣ What can employers do to protect themselves from losing employees to competitors?

Employers should include a non-solicitation clause in their contracts and ensure the clause is reasonable and does not infringe on an employee’s future employment rights.

Segment begins at 19:37

CALL: Employee rights after a contract has expired

I was hired by a company as an independent contractor on a one-year contract. The contract expired, however, I continued to work there for the last 5 years. The company has been “locked down” since the start of COVID-19. What is my status with the company?

Employees are often misclassified as independent contractors when they are in fact employees as they have worked exclusively with an employer and do not have the same level of freedom as a contractor. Despite a contract expiration, if an employee continues to work for the previous employer, they are still considered to have an oral agreement. Severance entitlements will be based on the totality of employment and not just the one-year contract.

Segment starts at 20:30

CALL: Severance for short service employees

My employment was terminated due to COVID-19 after about 8 months with the company. They gave me my vacation pay plus less than one week of pay in severance. Am I owed more than that?

An employer has the right to let an employee go as long as adequate severance is offered. Short service employees are often owed more severance than believed despite the shorter length of employment.

Segment starts at 24:47

New employer of the company not responding to calls regarding future employment

The company I work for changed ownership a few weeks ago. I was told by the new owner before the change that I would be kept on, but they needed to pause my job for a while before bringing me back. Now they’re not returning my calls. What should I do?

Employers who no longer contact an employee or offer hours of work are considered to have terminated their employees. Employees who cannot contact their employer can pursue their severance entitlements and should contact an employment lawyer.

Segment starts at 26:43

LEARN MORE
• Sale of a company in Ontario: Employee rights
• Company sold in Alberta: Who pays severance?
• Rights for employees when business sold in B.C.

NEXT EPISODE: Employment Law Show S5 E24 – 5 ways to determine if your severance package is fair

PREVIOUS EPISODE: Employment Law Show S5 E22 – Mistakes companies make that you need to know about