What makes a non-compete clause enforceable in an employment contract?
A ‘reasonable’ non-compete clause. To be enforceable a non-compete clause needs to be deemed to be reasonable, in terms of duration and scope and in its attempt to protect the employer.
Is it enforceable to sign a non-compete agreement?
Here’s where things get tricky. Whether or not a non-compete agreement is enforceable depends on whether or not it is reasonable, and what is reasonable is determined by state courts on a case-by-case basis; every state has its own laws regarding non-compete clauses.
What should I do if my employer breaches my non compete clause?
If your employer or former employer is suing you for breaching your non-compete clause, don’t panic. Your first step will be to enlist the help of a qualified employment lawyer. Your non-compete clause may not be enforceable and a non-compete employment lawyer can represent you in your dispute with your employer.
How long does a non compete clause last?
Non-compete clauses may be valid for various periods and typically no longer than a period of up to twenty four months. Employers may choose to make the length of the non-compete clause shorter.
Can you enforce your non-compete clause?
While an employer may be able to enforce a non-compete clause as long as it has a legitimate business interest as a reason for enforcement, you may have defenses. Similarly, if you have been asked to sign a non-compete agreement or other restrictive covenant, it is wise to consult with an employment lawyer prior to signing.
What is the purpose of a non compete?
Generally, the purpose of a non-compete clause is to prevent an employee from competing with the employer in a certain region for a specified period of time. The policy rationale is that the employee should not be able to exploit the employer’s proprietary information for personal gain.
Is a covenant not to compete is never enforceable?
The well-known general rule is that a covenant not to compete is only enforceable if its terms are reasonable and necessary to protect the legitimate business interests of the employer. See e.g., Medix Staffing Solutions, Inc. v. Dumrauf, No. 17C6648, 2018 WL 1859039 (N.D. Ill. April 17, 2018).
Can a non-compete agreement be enforced?
The enforceability of the non-compete agreement is determined by state law and precedent . In most cases, the court will rule in favor of the agreement if the employer can meet certain conditions. This is true regardless of the reason the employee left the company. However, not all non-compete agreements are fully enforceable under the law.