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Can contract disputes with employees lead to litigation?


Not all employees in Louisiana work on a contract basis. Some employees work on what is known as an “at-will” basis, which means that either the employee or the employer can end the employment arrangement at any time. However, when employees are hired based on the terms of a contract, that legal document will carry quite a bit of weight. So, it is important to get it right. Otherwise, a contract dispute may erupt down the road that could cause quite a few problems.

Could a contract dispute even lead to litigation? It is possible. Some employment contracts will have terms that govern what the person is allowed to do for work after leaving the company — known as “non-competition agreements.” These agreements have terms that usually state that a person who becomes a former employee is not allowed to engage in other employment that would be in direct competition with the former employer. However, enforcing these agreements can be tricky, as former employees who are flirting with a breach of the agreement will likely claim that their actions are not in direct conflict with the agreement.

Confidentiality agreements can also be part of an employee contract. In many jobs an employee must become familiar with a company’s strategically sensitive information, like plans for products, knowledge of how a certain process operates or even the components of certain pieces of machinery. A confidentiality agreement would obligate employees to keep these vital pieces of information secret even after their employment has ended.

Contract disputes with employees can be a messy business that can even lead to litigation in court. It is important for companies in Louisiana to make sure that they have the best information available when making decisions regarding employment contracts.

Source: FindLaw, “Employment Contracts and Compensation Agreements,” Accessed Jan. 7, 2017

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