Did You Know That Louisiana Law Treats Employees and Independent Contractors Differently?

I was in state court this week, the 19th Judicial District to be precise, arguing an often-overlooked provision of our non-compete statute. The opposing party, let’s refer to them as “Overreaching, Money-Grubbying Bully” or OMGB for short, was attempting to enforce a non-compete agreement against my client, who we will call “Winner.” Specifically, OMGB claimed that my client was in violation of the agreement because he began to solicit customers of OMGB immediately after his services as an independent contractor had been terminated.

We argued successfully that while our non-compete statute allows an employer and employee to agree that an employee will not: 1) engage in business similar to that of her employer or 2) solicit customers of her employer after her employment ceases, on its face the statute only allows an independent contractor to agree that she will not: 1) engage in business similar to that of the party with whom she has contracted. The statute contains no language that would allow an independent contractor to be prevented from soliciting customers of the party with whom she has contracted.

In this instance, my client was not engaging in a competing business in any prohibited parishes, she was merely soliciting customers of the party with whom she had contracted. Although I believe that the difference in the language of the statute as it applies to employees and an independent contractors was due to legislative oversight (perish the thought) rather than intent, the difference is nonetheless there. So, if you are drafting a non-compete agreement between your company and an independent contractor, remember that while you can prohibit them from engaging in competition with you, you probably cannot prevent them from soliciting your employees.

 

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