In any acquisition, whether for shares or assets, employee benefits and obligations must be taken into account. One of the potentially most onerous obligations includes the provision of pension benefits to employees – this makes it all the more important

This post was contributed by Jean R. Allard, Partner, Norton Rose Canada

In a recent Quebec Court of Appeal decision,[1] the court reversed a decision of all previous courts in a case regarding unfair termination for refusal to sign a non-compete agreement three years after the hiring date.

In this case, the employer, a pharmaceutical company, had recruited a chemist who lived in France.

The offer to the employee said he’d be asked to sign a non-compete agreement and a confidentiality agreement. However—and unfortunately for the employer—, only the confidentiality agreement was signed on the employee’s first day of work.

A few years later, after promoting the employee to director, the employer asked the employee to sign a non-compete agreement. The employee decided he wouldn’t sign the agreement unless the employer compensated him with a large sum of money and respected his demands on the duration of and territory covered by the non-compete clause.