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souvik101990
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Updated on: 20 Jan 2020, 10:00
Originally posted by souvik101990 on 02 Apr 2015, 08:26.
Last edited by Bunuel on 20 Jan 2020, 10:00, edited 1 time in total.
Last edited by Bunuel on 20 Jan 2020, 10:00, edited 1 time in total.
Renamed the topic and edited the question.
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A
Be sure to select an answer first to save it in the Error Log before revealing the correct answer (OA)!
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Some companies in fields where skilled employees are hard to find make signing an "agreement not to compete" a condition of employment. In such an agreement the employee promises not to go work for a competing firm for a set period after leaving his or her current employer. Courts are increasingly ruling that these agreements are not binding. Yet paradoxically, for people who signed such agreements when working for competing firms, many firms are unwilling to consider hiring them during the period covered by the agreement.
Which one of the following if true, most helps to resolve the paradox?
(A) Many companies will not risk having to become involved in lawsuits, even suits that they expect to have a favourable outcome.
(B) In some industries for example, the broadcast media, companies‟ main source of new employees tends to be people who are already employed by competing firms
(C) Most companies that require their employees to sign agreements not to compete are aware that these documents are not legally binding
(D) Many people who have signed agreements not to compete are unwilling to renege on a promise by going to work for a competing firm
(E) Many companies consider their employees established relationships with clients and other people outside the company to be valuable company assets
Which one of the following if true, most helps to resolve the paradox?
(A) Many companies will not risk having to become involved in lawsuits, even suits that they expect to have a favourable outcome.
(B) In some industries for example, the broadcast media, companies‟ main source of new employees tends to be people who are already employed by competing firms
(C) Most companies that require their employees to sign agreements not to compete are aware that these documents are not legally binding
(D) Many people who have signed agreements not to compete are unwilling to renege on a promise by going to work for a competing firm
(E) Many companies consider their employees established relationships with clients and other people outside the company to be valuable company assets
03 Apr 2015, 00:47
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souvik101990
Time : 1:37
(A) Many companies will not risk having to become involved in lawsuits, even suits that they expect to have a favourable outcome. -Correct. Even though the company knows that the courts will rule in their favour, they still have to incur the costs of a lawsuit.
(B) In some industries for example, the broadcast media, companies‟ main source of new employees tends to be people who are already employed by competing firms - OFS. Doesnt tell us why cos do not hire employees during their non-compete contract period
(C) Most companies that require their employees to sign agreements not to compete are aware that these documents are not legally binding - We dont have to know about the previous company but the future company which doesnt hire the people during their non-compete period. Irrelevant
(D) Many people who have signed agreements not to compete are unwilling to renege on a promise by going to work for a competing firm - OFS. We are concerned about those people who sign the agreement but do go to other cos for employment
(E) Many companies consider their employees established relationships with clients and other people outside the company to be valuable company assets - I don't think any co would consider the relationship between its employees and their past cos as a valuable asset.
Answer: A
04 Apr 2015, 04:53
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I dont understand how A.. According to agreement, the employee is signing it. So if the employer has to sue, it has to sue only the employee not the competing firm. But D states that the new employer will not hire the employee because they feel that the employee will not be reliable.. Please explain..
