Can My Former Employer Now Customer Block My Employment with Their Customer

[hardy01]

My question involves business law in the state of: ARIZONA

I want to accept a job offer with a customer of the company that pays me. I am not really an employee. I was for years, but two years ago I was laid off. Since then, I have been a sole proprietorship and I have gotten two 1099-MISC forms from my former employer now customer.

They pay me for jobs that I bill them. They also provide supplies, a phone and travel expenses and I have a company credit card. I have never signed a contract with my employer. The relationship has never been formalized. Just handshakes. I just email them spreadsheets showing hours I worked and they send me checks in the amount of my hourly rate times the hours.

The terms and conditions of every contract my former employer has with customers has this passage:
"Commencing immediately, and continuing until a date one (1) year after the date of final completion of the Work, [customer name here] agrees not to directly or indirectly employ, solicit for employment, or advise or recommend to any other person that such other person employ or solicit for employment, any person employed by or under contract to [my former employer name here]."

This job represents a huge opportunity. My my former employer (now my main customer) does not have anything requiring them to give me any work and they how have employees taking over some of the work. But they clearly want me around. Can they block their customer from hiring me?

[Conrad Hunter]

No. Based on the information in your post, I see no confict after one year. There does not seem to be any viable cause of action.

However, the new employer would have to be aware of the contract and be aware of the potential but remote liability, unless you want to get sued by two former employers.

Actually, on second thought, the contract is binding not on you, but on the customer. So it is the customer who is taking all the risk.

[hardy01]

Thanks for the reply. My customer (former employer) signed a contract with his customer a few weeks ago. Then his customer revealed a need for someone with my skills. I told this company that I am just a contractor not an employee and that I am free to do what I want. So they are very interested. We can't wait a year and nowhere near a year has gone by. I think they will offer me a job and now I'm worried that my customer/ex-employer will make trouble. The question for me comes down to this: can he just lock me up, so to speak, and make it impossible for anyone we do work with to hire me just by saying that I'm a contractor for him because I get checks and 1099's? While possibly not relevent, this does not seem fair since I have no agreement with my customer/ex-employer and he does not have to give me work yet his contract with everyone has that clause. Does this information add anything helpful in accessing this matter? I am not sure what to expect but I think I'm going to get an offer. While not relevent I will mention it is a very big company with lots of money and my customer/ex-employer is not going to want to annoy them.

[Mr. Knowitall]

The terms and conditions of every contract my former employer has with customers has this passage:
"Commencing immediately, and continuing until a date one (1) year after the date of final completion of the Work, [customer name here] agrees not to directly or indirectly employ, solicit for employment, or advise or recommend to any other person that such other person employ or solicit for employment, any person employed by or under contract to [my former employer name here]."

So you're stating that you presently perform work under contract for your former employer, and you want a job with their customer? So you agree that you're covered by this clause?

My my former employer (now my main customer) does not have anything requiring them to give me any work and they how have employees taking over some of the work. But they clearly want me around. Can they block their customer from hiring me?

You say they "clearly" want you around because... they have told their client that if the client hires you it will be in violation of the quoted contract term? That they will sue?

I think they will offer me a job and now I'm worried that my customer/ex-employer will make trouble.

And they may try to "make trouble".

The question for me comes down to this: can he just lock me up, so to speak, and make it impossible for anyone we do work with to hire me just by saying that I'm a contractor for him because I get checks and 1099's?

A contract term of this type applies only to the parties to the contract - in this case your former employer / present client and your prospective employer. The contract between those two parties irrelevant to any other prospective employer.

While not relevent I will mention it is a very big company with lots of money and my customer/ex-employer is not going to want to annoy them.

Actually, that is relevant. Because your prospective employer may decide not to hire you to avoid potentially annoying your former employer / client even if they believe the contract does not apply to an offer of employment to you. Their best practice would be to try to determine if your former employer / client objects to their employing you, so as to not risk "annoying" them.