I entered into an employment agreement with a unlicensed contractor (Nov 2019) who was soliciting and performing services as General Contractor. While unlicensed, we were the prime contractor carrying out the scope of a GC on no less that three projects. We we are now qualified company (Feb.2021). Since I entered into the employment agreement with the company who was a unlicensed contractor who conducted illegal contracting, is my employment agreement, which includes a non-compete, enforceable?
I concur with the excellent points made by Attorneys Cobb and Bass. From a purely non-compete analysis, restrictions on competition are only enforceable in so far as they support a legitimate protectible interest. The unlicensed status of the qualifying contractor and the relationship thereof to the putative employer entity may well factor into a number of arguments that can be made that the agreement was void ab inito or that the restrictions were unreasonable in the scope of their non-compete/non-solicit provisions.
Consult with counsel who has experience in litigating non-competes as it is a technically complex area to plead and prove and inexperienced lawyering in this area of law can really hurt the client.