Posts tagged with "salon"

Enforcement of a Non-Compete Agreement in the Salon Industry

Enforcement of a Non-Compete Agreement in the Salon Industry
Piscitelli v. Pepe, 2004 Conn. Super. LEXIS 3264

Ms. Francine Piscitelli owned and operated a hairdressing and beauty salon since 1985. She employed Ms. Bernadette Pepe as a stylist from 1990 to July 31, 2004. The salon moved and underwent a change in its trade name in 1997. Ms. Piscitelli had Ms. Pepe sign an Employment Agreement on February 27, 1997 that contained a restrictive covenant. The non-compete agreement prohibited Ms. Pepe for one year following termination from engaging in competing business activities, soliciting the salon’s employees, or soliciting the salon’s current clients. The agreement designated a restricted area for the covenant not to compete: Branford, North Branford, East Haven, Guilford, and the portion of New Haven east of the waterway formed by the Quinnipiac River, New Haven Harbor, and Morris Cove.
Ms. Pepe signed a three-year lease on March 9, 2002 for a premise in North Branford to operate a full-service hair and nail salon. Ms. Piscitelli learned of this in May 2004, confronted Ms. Pepe about the development, and Ms. Pepe confirmed what her boss had been hearing around the salon. Ms. Pepe assured her boss that she would not be soliciting any of the employees or any current clients beyond her own. Ms. Piscitelli was comforted by these assurances and allowed Ms. Pepe to continue to schedule appointments at the salon until she voluntarily terminated her employment on July 31, 2004. In the following months, three stylists left the salon the work for Ms. Pepe at La Bella salon and Ms. Pepe solicited clients of her previous salon regarding the opening of her own salon.
Ms. Piscitelli sued Ms. Pepe in Connecticut state court for breach of the non-compete agreement. Ms. Pepe however contended that the agreement was unenforceable because it: 1) lacked adequate consideration, 2) contained unreasonable restrictions, and 3) there was an adequate remedy at law, thus barring injunctive relief as an appropriate legal solution. The court rejected these defenses, found in favor of Ms. Piscitelli, and granted her request for enforcement of the covenant not to compete.
While the agreement did not increase Ms. Pepe’s compensation, paragraph ten created additional consideration because it obligated the employer, Ms. Piscitelli, to pay for “certain courses in professional education and training”. This benefit, according to the court, was adequate consideration in exchange for Ms. Pepe’s covenants. Furthermore, the court concluded that the covenant not to compete was reasonable with respect to the time and geographical limitations contained therein. The restrictions did not unnecessarily restrict Ms. Pepe’s ability to earn a living or secure future employment within the salon industry. The restriction adequately protected Ms. Piscitelli’s legitimate business interests while not excessively harming Ms. Pepe’s career opportunities. Lastly, the court disagreed with Ms. Pepe that there was an adequate remedy at law available for the case. The court held that Ms. Piscitelli met the burden of proof to show the need for an injunction and concluded that injunctive relief was appropriate for the case.
If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, please contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.

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Non-Compete Agreements in the New Haven Salon Industry

Non-Compete Agreements in the New Haven Salon Industry
Sabatasso v. Bruno, 2004 Conn. Super. LEXIS 899

Mr. Pascale Sabatasso owned SoHo Hair Group Day Spa where he had provided salon services for over twenty years and employed approximately twenty-two employees. He hired Ms. Jody Brinkmeyer in June 2001, Ms. Jo Bruno in September 2001, and Ms. Cara Hanson in February 2002 to work as stylists. Pursuant to his long-standing employment policies, he had the three women sign non-competition and confidentiality agreements as a condition to their employment. The restrictive covenants prohibited the women for twelve months following termination from rending competing services within ten miles from the center of New Haven, soliciting SoHo clients, or soliciting SoHo employees. This clause created a restricted area that included all or part of New Haven, North Haven, East Haven, West Haven, Hamden, Woodbridge, Orange, and Branford. Ms. Sabatasso justified the need for such a restrictive covenant in order to protect the salon’s investment in the form of the expenses incurred associated with the training, education, and marketing of its stylists.
The three women voluntarily terminated their employment at SoHo on April 26, 2003 and began to work at Designers, a competing salon located in Orange, a city well within the restricted area defined by the non-compete agreement. Mr. Sabatasso’s legal representation sent the women letters on May 15, 2003 stating that he would withdraw legal action if they immediately terminated their employment with Designers. All three did in fact terminate their employment at Designers to pursue other employment options. Ms. Brinkmeyer began to work as a stylist at a salon in Southbury (a city outside of the restricted area), Ms. Hanson lived in Woodbridge but did not work as a stylist, and Ms. Bruno provided styling services out of her home in East Haven and the homes of former SoHo clients, the majority of which were located within the restricted area. Ms. Sabatasso proceeded to sue the three women in Connecticut state court and requested the enforcement of their respective non-compete agreements.
The court granted an injunction with respect to Ms. Bruno but denied the requests for injunctions for Ms. Brinkmeyer and Ms. Hanson. The holding stated that Ms. Bruno “shall adhere to all of the terms and conditions provided for in the agreement for a period of one year from the date of her voluntary termination”. The court found that only Ms. Bruno had breached the non-compete agreement and that the continued activities of Ms. Brinkmeyer and Ms. Hanson were permissible and in accordance with the covenant. The former employees presented several arguments as to why the agreement was unreasonable but the court concluded that its provisions were in fact reasonable and enforceable in the event of a breach, as was the case with Ms. Bruno.
SoHo, according to the court, as a matter of public policy was entitled to protect its proprietary property including its customers for a reasonable period. One year was not so extreme or restrictive and as such, the court found this to be a reasonable restriction. Additionally, the court concluded that the ten-mile restriction was reasonable given the facts of the case and the circumstances of the salon industry in the New Haven area. Seventy-five percent of SoHo’s clients lived within the ten-mile radius and the company had an interest to protect its proprietary property within that area. The court also noted that there were three hundred to four hundred salons located in non-restricted areas within a thirty-minute drive from the women’s homes. Two of the women testified that a thirty-minute drive was acceptable and the court did not believe that this amounted to an unreasonable hardship. This finding demonstrated that the provisions of the non-compete did not overly restrict the women’s ability to pursue their profession or find new employment at a salon that would not violate the covenant.
If you have any questions relating to your non-compete agreement or would like to discuss any element of your employment agreement, please contact Joseph C. Maya, Esq. by phone at (203) 221-3100 or via e-mail at JMaya@Mayalaw.com.

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