Being Shafted

[xgnr]

Take him out for a beer and give him the beats in the car park afterwards !

Yeah right like that's going to solve anything. Buy the guy a beer and king hit him

Nice

[boomer]

Yeah right like that's going to solve anything. Buy the guy a beer and king hit him

Nice

fancy a beer tonight?

[p.dath]

I have decided to put in a restraint of trade clause with new employees. If they leave they are welcome to set up there own businesses, but not on my turf and not taking my clients with them.

You should take a read of this:

http://www.howtolaw.co.nz/html/ml126.asp

In general the greater the restraint – whether in terms of geographical area, time or the type of business – the more likely the court will be to hold that the restraint clause is invalid.

[Ixion]

Based on the amount of red rep I have gotten on this one several of you don't believe me on the 80% rule. Here is a reference for you. If you use Google you will find many more references. This is a well established rule.

http://www.crackerjacks.co.nz/resour...eorcontractor/

.

The gentleman is correct. The "80% rule" is one indicator that IRD (and unions!) will use to determine if there is a genuine contractual relationship or a disguised employee relationship. However, it is not an absolute, just an indicator. If more than 80% of income comes from a single source then IRD will ask "what gives". But there could be a number of situations where the relationship could be contractual but one customer predominant. If the relationship is genuinely contractual (there are numerous other tests than can be applied) then IRD will be OK, despite the 80% thing

(FTW IANAL but the Transfield situation does not seem to be genuinely contractual to me. I would be surprised if IRD do not look hard at it)

[cs363]

You should take a read of this:

http://www.howtolaw.co.nz/html/ml126.asp

In general the greater the restraint – whether in terms of geographical area, time or the type of business – the more likely the court will be to hold that the restraint clause is invalid.

True, it's all about keeping it realistic as per my earlier post. If kept to the immediate area & surrounds it is usually easier to uphold, rather than trying to make the restraint cover the entire country for instance.
Judging by the posters comment below, I suspect that was what he was meaning.

If they leave they are welcome to set up there own businesses, but not on my turf and not taking my clients with them.

Like any legal document though, it's only as good as the person putting it together which is why it does not pay to take a DIY approach to this sort of thing. Well worth paying the $$ to a good professional.

[Max Preload]

Go wider afield...the mileage is tax deductable. At the end of the day reputation and job quality will count for plenty and good luck out there

Well, you still pay 2/3rds of the cost of mileage out of your own pocket, and travel time isn't deductable, although chargeable but doing that may price you out of the jobs.

I'm guessing you didn't have a restraint of trade clause in your employees contract then? Something to think about if you ever go down the track of employing someone again, especially if you are in a 'small world' industry.

I have decided to put in a restraint of trade clause with new employees. If they leave they are welcome to set up their own businesses, but not on my turf and not taking my clients with them.

Restraint of trade clauses for employees are largely unenforcable, and rightly so.

Mark that sucks big time,I knew a couple of guys who went into laying 50/50,one then set up a nightclub and other bought him out,with proviso he wouldn't set up within 5 yrs in competition as contractor.Worked ok.

Sale of a shareholding - completely different scenario.

Having run several companies I have quite a bit of commercial experience, and the IRD 80% income test from one source for contractors is widely known.

Having worked as an independant contractor for at least the last decade and frequently having all my income derived from one client in a year or two, as have my friends in the same line, I know that's not the only criteria. Otherwise courier owner/drivers etc would be up shit creek.

Like any legal document though, it's only as good as the person putting it together which is why it does not pay to take a DIY approach to this sort of thing. Well worth paying the $$ to a good professional.

Not to mention your ability to pursue it - just like patent breaches.

Now, to the original post... I fail to see the problem. The guy made plans and left, moving to another city, his plans didn't work out, he returned to an area where most of his friends probably reside and started his own business. Why do you feel he owes you anything? You presumably made money out of him while he was working for you. Shouldn't he be allowed to do his own thing? How would you like it if someone else tried to dictate where you were allowed to work in your trade just because you'd previously worked for them?

Competition is healthy. I'm self-employed and I have no fear of it - in the last month or so I was so over run with work having taken on some from a desperate friend that I had to get another self-employed person in my field to take on some of my work direct with one of my clients. Rather than seeing it as an opportunity to shaft me, the client views it as very ethical and helpful - their needs were met without any hassle to them. Who do you think they'll call first next time? The person who has proven they can get the job done with the minimum of fuss.

You're already a leg up on this guy anyway - you're established in the area and presumably have a good reputation. Don't let pettiness tarnish that.

[Maha]

Spent a good part of today on the North Shore. Visited eight flooring shops looking for work. Got two and two 'maybe, leave ya number' answers. But also got four positives, nothing concrete but, I know two of them personally and have worked with them in the past. The other two? good feeling about our conversation so hopefully something comes of it.

The other good news is, last week, I spent three days at a school sanding and coating 122sqm ready for floor coverings. My first time with this constuction company and I was rapt with how it all went. I sent them an email, a really good email about the job site and the way it was run. I got an email form that company today wanting me to price two classrooms for them at another school close by, so all n' all its been a relatively productive day.

[cs363]

Good work - nice to see things are moving forward in a positive way Maha

[ynot slow]

Bloody must be holidays ahead,with school jobs on horizon,2 weeks goes fast,especially when the painters are supposed to be out at end of term,but still there middle of week 1,fun tripping over flooring guys while trying to hang blinds.Even if we're all from same firm,at least we could say fuck off back and forth and not get pissed off with each other.

[Gareth51]

Onwards and upwards Mark,as one door closes another shell open.
Looking foward to catching up on the 3rd