Non-compete agreements are fairly common in employment agreements. It seems like these days, nearly every employee making over $100K has some form of a non-compete.
Non-compete agreements can prevent an employee for working within their field for a period of time, even if the employee is laid off or wrongfully terminated.
- What Do Non-Compete Agreements Typically Cover?
Non-compete agreements typically cover what activities an employee may not engage in, for how long the employee may not engage in those activities and where the employee is prohibited from engaging in such activities. Broadly drafted and frequently forced on employees, these agreements considerably limit an employee’s ability to work within their chosen field.
- Why Is It Useful to Have a Lawyer Review a Non-Compete Agreement?
As with any legal document, it is important to have an attorney review your non-compete agreement. It is especially important to do so with a non-compete agreement because these agreements are like prenuptial agreements for your job – you need to know what to expect in the event of a work divorce.
- How Much Time Do You Need to Review a Non-Compete Agreement?
Often times, employers put pressure on an employee to sign their non-compete right away. Also, the non-compete agreement is often stuffed together with other onboarding documents like compensation documentation and other offer terms. Often the non-compete is overlooked while an employee is swept up in the excitement of starting a new job.
An employee should take at least a day or two to review the non-compete agreement and evaluate what impact the agreement would have on is or her career. Given the stakes, it is often useful to consult with an attorney to better understand the enforceability and, more importantly, likelihood of enforcement, of the non-compete.
Granovsky&Sundaresh PLLC specializes in non-compete agreements, and can review and consult you regarding all aspects of your non-compete agreement within 24 hours.
- What are the Benefits and Consequences of Not Signing the Non-Compete Agreement (for the employee)?
More often than not, employers make signing a non-compete agreement a condition of employment. So, if the employee signs, he or she can start the job.
Conversely, refusal to sign will likely cost the employee his or her job.
- What do Employees Often Overlook? What Are Common Myths or Misunderstandings?
Most employees focus on whether or not their non-compete agreement is enforceable. But the more important issue is whether the employer will seek to enforce the non-compete agreement to begin with. Because if the employer does not seek to enforce the agreement, does it really matter if there was some technical violation of the non-compete that never becomes a problem? It is therefore critical that the employee understands the likelihood of a lawsuit for breach of non-compete.
- Are There Times That Non-Compete Agreements are Enforced?
Yes, there are times when non-compete enforcements can be enforced. These tend to be limited to situations where the employee’s conduct causes (or will inevitably cause) harm to the former employer (for example where the departing employee takes company confidential information or clients to the new employer).
- Do Non-Competes Have to be Reasonable?
Non-competition agreements have to be reasonable in scope. In order to be enforceable, a non-compete agreement must be no more broad than is necessary to protect the legitimate interests of the company. Non-competes have to be about protecting a company, not limiting an employee’s ability to make a living. Non-compete agreements that are overbroad tend to be less enforceable or altogether unenforceable.