Colorado Civil justice League applauds a unanimous decision by the Colorado Supreme Court which will benefit both employers and employees.
The decision in Lucht’s Concrete vs. Horner (Case No. 09SC627) reversed a Court of Appeals ruling that held that continued employment is not adequate consideration for a noncompetition agreement once an employee has been hired.
“We find no distinction between a decision to agree to a noncompetition agreement offered at the initial hiring period and a decision to agree” after employment has begun, wrote Justice Allison Eid.
The court re-affirmed that an at-will employment contract is renewed on a daily basis and that an employer and an employee both enjoy the right to terminate that contract on any given day.
“Lucht’s had the legal right to discharge Horner; however, it chose not to exercise this right in exchange for Horner’s acceptance of the noncompetition agreement,” the court ruled.
In a brief written by legal advisory board chairman Christopher L. Ottele, CCJL argued that the law makes no distinction between agreements that benefit the employer and obligate the employee or vice versa.
Ottele observed that the Court of Appeals ruling would have absurdly encouraged employers to discharge an employee and condition rehiring on the signing of a noncompetion agreement. The ruling also threatened to overturn decades of Colorado precedent that had enforced agreements between at will employees and employers based solely on continued employment.
