In Court and On Paper

What Are Non-Compete Agreements and Are They Enforceable?

3 May 2021

Avery Bryant

One of the things your new employer might want you to sign is a non-compete agreement. These agreements can cause difficulties after you leave the company. In some parts of the country, they are even illegal or unenforceable. Even if they are not illegal, you may need the help of an employment attorney if you have a problem. Here are some questions and answers about non-compete agreements and how an attorney can help render one null and void.

What Is a Non-Compete Agreement?

A non-compete agreement is a contract you sign with your employer. It restricts you from working for their competitors or yourself in the same field. Usually, there is a time limit for the restriction. For example, your contract may restrict you to six months or a year. You are likely to receive the contract at the beginning of your new job.

Employers often draft non-compete agreements for various reasons. For one, they don't want to spend time and money training you, and then you take those new skills to a competitor or to start your own business. Another reason is they don't want to risk you possibly giving trade secrets to a competitor.

Why Are Non-Compete Agreements a Problem?

The problem with non-compete agreements is that they can severely restrict you from getting a new job if you are fired or laid off. If your job is very specialized, then you may have limited options for new employment. You may be unable to find a job in your field until the agreement expires.

When Are Non-Compete Agreements Enforceable?

While some states do not enforce them, other states will enforce them if they meet certain requirements. For example, the contract may be enforced if they meet the following criteria:

• The business has a legitimate reason to have a non-compete agreement.
• The time limit is reasonable.
• The agreement doesn't cause undue hardship or prevent you from finding another job.
• The agreement only restricts you from working for a few competitors or yourself.
• The agreement is not overly broad or vague.
• The agreement is limited to a geographical area.

If you want to nullify your agreement, you may have to prove that one or more of the factors listed above are in play. Sometimes, this process requires you to hire an attorney and go to court.

Though non-compete agreements have fallen out of favor over recent years, they are still enforceable contracts in many areas. If you feel your non-compete agreement unreasonably prevents you from earning a living, contact an attorney. Your employment attorney can look over your agreement and see if you have a legal way out.

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