Question Summary:
Penalty from one’s own side to someone who breached a verbal contract

Question Detail:

Assalamu Alaikum
 
I need to ask question regarding Business, I will explain the back ground of the question as well
in our country we are first manufacturing country, citizen owned company  and one only 7 years we have opened it when requirement  for our factory we employed family related guy who had permit for another company than we put variation and took it our company when he he came to our factory he didn't have any knowledge of manufacturing of our products, when the 2nd term of his permit he obtained 10years Resident permit bcoz our manufacturing details and we paid for it (for whole Family). we have trained with all our formula and trade secret sine in our country much people dont have this knowledge since it is too technical 
During his 7 years for working we have employed several other people and we signed non disclosure and non competitive agreement but with him we have informed verbally and we didnt didn't signed
Last we decided to signed the agreement than he told he is leaving bcoz of his health condition and other issue and we asked told him signed anyhow than he said we are family I AM NOT GOING TO OPEN AGAINST OR COMPETE WITH YOU I am going to do other work in the same country
 
Now he is planning to open  against us with some other people bcoz he has not honored his word and we paid for his permit 
my question is we are planning to cancel his permit is it permissible to do so, as immigration we should inform them that this guy is no ore with us and cancel our name but we went further and told them he his work without proper permit bcox his current work permit for our company and for his own company where he is setting for another company so we have are planning inform the immigration 

Answer :

In the Name of Allah, the Most Gracious, the Most Merciful.
As-salāmu ‘alaykum wa-rahmatullāhi wa-barakātuh.
We take note of the following,
1)    The person in reference is a family member.
2)    His permit was from another company.
3)    When he was employed by your company, the permit was transferred onto your company’s name.
4)    Your employees sign a non-disclosure and a non-competitive agreement.
5)    The employee in reference did not sign such an agreement but verbally agreed to it. He stated he will not open and compete with the company.
6)    He now plans to open a similar business.
At the outset, the non-competitive agreement to restrain another from entering the same or similar business is incorrect. ^[1]
If the family member opens a similar business, it is his Shari right to do so. It is our belief that Rizq and sustenance is from Allah Taala and not through closing doors of competition and restraint.
The family member initially obtained permit from another company. It was changed to your company. Advise him to change it to his new employment. ^[2] It is unethical to report him and get him deported due to him entering a similar business. More so, he is a family member and deserves your support and favor.
And Allah Ta‘āla Knows Best
Mehrazur Rahman
Student Darul Iftaa
Brooklyn, NY, USA
Checked and Approved by,
Mufti Ebrahim Desai.