Breach of Employment Contract When I transferred jobs

Hello Atty,

I just wanted to seek your professional opinion on this. I worked as IT head for a retail (mens and womens apparel) company for 5 years and just transferred to to another retail company also as IT head. The new company sells multiple brands namely cosmetics, footwear, lingerie and womens apparel. My clearance was processed and i received my last pay. Yesterday, i received a letter (thru registered mail) from a law office demanding that I cease to work with the new employer and pay damages of 3 million due to breach of contract. It states that it is included in my employment contract that i may not work for other companies with the same nature (retail) and/or direct competitor for a period of 1 year upon resignation.

I just wanted to know if this holds water as the employment contract that i signed wasnt explained to me (just handed by HR as SOP). My new company isnt a direct competitor of the former but is in the same business of retail. Can they really use that against me and ask for damages? Also, it seems like I am being singled out since i know of plenty of other employees who transferred to direct competitors but were not sent demand letters. In fact one former co-worker (brand manager) is now working with me here also (as brand manager) but never got a demand letter.

Kindly advise me please.

Thanks.

Erick

Hi! I am just curious when you said demand letter is it summons from the municipal or the company is demanding something from you?
If you were given a clearance and you are done working with them, why would they sue you?
On the other hand if it is estated on your contract 1 year period, but then again you resigned and was given a clearance? it should not be their business to get involve wherever you go and work next. Unless they are that insecure and you are a big loss to them.
I am confused the way you put it!

Best thing for you to do is to have some local services if possible from the municipal itself to look at your contract and read it through, so they can help you and give you a proper advice. this is not easy to talk about it online without reading through your contract.
3 millions penalty? have they gone mad? are you a millionaire? people will take every opportunity to ruin your life, perhaps someone hated you from that company as you estated here non of your colleague had faced any of your circumtances! very odd! wish you luck on this!

egoesguerra wrote:Hello Atty,

I just wanted to seek your professional opinion on this. I worked as IT head for a retail (mens and womens apparel) company for 5 years and just transferred to to another retail company also as IT head. The new company sells multiple brands namely cosmetics, footwear, lingerie and womens apparel. My clearance was processed and i received my last pay. Yesterday, i received a letter (thru registered mail) from a law office demanding that I cease to work with the new employer and pay damages of 3 million due to breach of contract. It states that it is included in my employment contract that i may not work for other companies with the same nature (retail) and/or direct competitor for a period of 1 year upon resignation.

I just wanted to know if this holds water as the employment contract that i signed wasnt explained to me (just handed by HR as SOP). My new company isnt a direct competitor of the former but is in the same business of retail. Can they really use that against me and ask for damages? Also, it seems like I am being singled out since i know of plenty of other employees who transferred to direct competitors but were not sent demand letters. In fact one former co-worker (brand manager) is now working with me here also (as brand manager) but never got a demand letter.

Kindly advise me please.

Thanks.

Erick

Hi,

Actually there was no header on the letter from the Law Office so i cannot really say it is a demand letter. The way i understood it is the law office is saying that i did a breach of contract with their client (my former company)since i transferred to a competitor company. At the bottom of the letter, there was a statement saying that i should cease working with the new company and pay P3M in damages to my former company within 5 days of receipt of the letter.
What is stated on my regularization contract is that I may not work with another company of the same nature and/or a direct competitor within 1 year upon leaving. So i guess they are demanding that i dont.

And yes I think the owners are a little pissed since i turned down their counter offer. But i didnt expect anything like this to happen since I left them in good terms.

Thanks for the advise mdventura . I was hoping that this is just a scare tactic from their end. Now i think i have to make sure that this does not prosper to what i think it is. By the way, i am not a millionaire. Just a regular employee trying to make a decent living.

Thanks again and more power to you!

mdventura wrote:Hi! I am just curious when you said demand letter is it summons from the municipal or the company is demanding something from you?
If you were given a clearance and you are done working with them, why would they sue you?
On the other hand if it is estated on your contract 1 year period, but then again you resigned and was given a clearance? it should not be their business to get involve wherever you go and work next. Unless they are that insecure and you are a big loss to them.
I am confused the way you put it!

Best thing for you to do is to have some local services if possible from the municipal itself to look at your contract and read it through, so they can help you and give you a proper advice. this is not easy to talk about it online without reading through your contract.
3 millions penalty? have they gone mad? are you a millionaire? people will take every opportunity to ruin your life, perhaps someone hated you from that company as you estated here non of your colleague had faced any of your circumtances! very odd! wish you luck on this!

egoesguerra wrote:Hello Atty,

I just wanted to seek your professional opinion on this. I worked as IT head for a retail (mens and womens apparel) company for 5 years and just transferred to to another retail company also as IT head. The new company sells multiple brands namely cosmetics, footwear, lingerie and womens apparel. My clearance was processed and i received my last pay. Yesterday, i received a letter (thru registered mail) from a law office demanding that I cease to work with the new employer and pay damages of 3 million due to breach of contract. It states that it is included in my employment contract that i may not work for other companies with the same nature (retail) and/or direct competitor for a period of 1 year upon resignation.

I just wanted to know if this holds water as the employment contract that i signed wasnt explained to me (just handed by HR as SOP). My new company isnt a direct competitor of the former but is in the same business of retail. Can they really use that against me and ask for damages? Also, it seems like I am being singled out since i know of plenty of other employees who transferred to direct competitors but were not sent demand letters. In fact one former co-worker (brand manager) is now working with me here also (as brand manager) but never got a demand letter.

Kindly advise me please.

Thanks.

Erick

Contract sometimes, especially if they did not give you enough time to read it, before signing it, can be really risky. Most of the contract, the important bits are printed deliberately in a smaller fonts. So people who are reading it end up not bothering to read the whole content, and not knowing those small print are the most important facts to know, especially when they emphasized it as 'disclaimer' unless you are aware of that, people just sign it to get it over with and accept the contract without reading through carefully. In your case, it sounds like you were rushed to sign the contract. But, they gave you a clearance in the end of your service with them make sure you have the original copy of that in hand, it may come handy for you at some point.
I doubt they can seriously file a case against you they are just being bitchy and insecure! They may on the otherhand get you for Data Protection if you leak any information about their company. So be very careful if you know it is not yours and it is not your original idea don't leak it to your new employer. Try to ask around with professional lawyers in Business they may be able to give you the proper advice on how to deal with this contract issues. If they are trying to charge you millions, are they trying to help bail Corona?
Good luck!

Ciao!

Hi,

Actually there was no header on the letter from the Law Office so i cannot really say it is a demand letter. The way i understood it is the law office is saying that i did a breach of contract with their client (my former company)since i transferred to a competitor company. At the bottom of the letter, there was a statement saying that i should cease working with the new company and pay P3M in damages to my former company within 5 days of receipt of the letter.
What is stated on my regularization contract is that I may not work with another company of the same nature and/or a direct competitor within 1 year upon leaving. So i guess they are demanding that i dont.

And yes I think the owners are a little pissed since i turned down their counter offer. But i didnt expect anything like this to happen since I left them in good terms.

Thanks for the advise mdventura. I was hoping that this is just a scare tactic from their end. Now i think i have to make sure that this does not prosper to what i think it is. By the way, i am not a millionaire. Just a regular employee trying to make a decent living.

Thanks again and more power to you!