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Sign a non-compete after resignation?

Raleigh, NC |

My employer recently informed me that they were unhappy with my performance. I was in sales for a web design firm in NC. I am only 24 and this is my first sales job out of college. My employer told me that I could either resign or be fired for poor performance. I did NOT sign a non-compete when I started my job. He coerced me into quitting by stating that I would not want that termination on my record. He then told me that since he was 'letting me resign' that he was going to require that I sign a non-compete (after I already sent my letter of resignation) Now, I am without a job, have no chance at receiving unemployment and he is threatening that we can "take an alternative route" if I decide to have a lawyer look at the agreements. Is this legal? What should I do?

Attorney Answers 3


It's legal and often done for an employer to get a non-compete as part of a termination agreement, where you also release them and promise not to sue for discrimination, worker's comp, etc.

But it's also the case that all agreements require "consideration," meaning in this case, they get a non-compete, so you have to get something. Being allowed to resign could be the consideration, since you were going to be fired for cause anyway, but I'd expect the non-compete, resignation and release to happen at the same time and as part of the same transaction, perhaps with a severance payment.

I'd see an employment lawyer before signing anything. The employer doesn't need to know that you're consulting a lawyer.

Avvo doesn't pay us for these responses, and I'm not your lawyer just because I answer this question or respond to any follow-up comments. If you want to hire me, please contact me. Otherwise, please don't expect a further response. We need an actual written agreement to form an attorney-client relationship. I'm only licensed in CA and you shouldn't rely on this answer, since each state has different laws, each situation is fact specific, and it's impossible to evaluate a legal problem without a comprehensive consultation and review of all the facts and documents at issue.

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I would not sign the non-compete regardless of what he says. The resignation letter is a good thing for the employer because you usually are not entitled to unemployment if you resign. However, if you were unequivocally told that you were being terminated, and you resigned, it should be treated as a resignation in lieu of termination. That means it should be treated as a discharge and the employer would have the burden of proving misconduct or substantial fault (i.e. that you are not entitled to benefits.)

Kirk J. Angel is an experienced North Carolina licensed attorney who focuses his practice on employment law. Mr. Angel, who has focused on employment law for more than 15 years, represents clients throughout North Carolina and more information about him is available at This response is for general informational purposes and does not constitute legal advice. Additionally, this response does not create an attorney client relationship. If you need legal advice, please contact a lawyer in your state who practices in the appropriate area.

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I woulld advise you consult an attorney in your state. An hour appointment should be sufficient. I would not advise a client to sign under the facts you staet above.

The above is general legal and business analysis. It is not "legal advise" but analysis, and different lawyers may analyse this matter differently, especially if there are additional facts not reflected in the question. I am not your attorney until retained by a written retainer agreement signed by both of us. I am only licensed in California. See also terms and conditions item 9, incorporated as if it was reprinted here.

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