Are Non-Compete Agreements Legal

Are Non-compete Agreements legal?

Welcome to our brand new video and blog series at The Crone Law Firm, PLC, Legal Video Bulletins! Alan gets asked questions every day from people on employment related questions. Alan goes through all of the details in each of these questions to make sure that he can answer each question fully. First questions we wanted to tackle, are non-compete agreements legal?

So, Are non-compete agreements legal? The short answer is yes, they are legal.

They are not illegal, but they are blunt instruments. If you are looking to enforce a non-compete agreement, you have to show a compelling business interest to do so. They have to be reasonable in time and scope and geography, and they have to be narrowly tailored to a specific situation. And what I mean by that is non-competes are evaluated by courts, really on a case-by-case basis. And so, it is important to make sure that they are narrowly tailored to achieve a particular business objective.

In essence, that’s what the courts are looking for in non-compete agreements. Is this non-compete agreement sufficient to prevent the target of the non-compete from gaining an unfair competitive advantage because of their prior association with the enforcing company? At the Crone Law Firm, we have been on both sides of these cases. We’ve enforced non-compete agreements literally all across the country, and we’ve defended non competes across the country.

Different states have different laws and different court decisions, but it basically comes down to that. Most judges are very reluctant to put somebody completely out of work unless there’s a compelling reason to do so. And so, it’s important when you’re drafting these non-compete agreements that they’re narrowly tailored. It is also important that you don’t just take the non-compete and put it in a drawer and forget about it until it’s time to enforce it.

If you’re relying on confidential information, for example, as your compelling business interest, you need to make sure that your employees know what information is confidential, why it’s confidential, that is well marked, and that you’re taking what I call 360-degree measures to make sure that the information is, in fact protected.

If you’ve got non-disclosure agreements with customers, vendors or other people that would also have access to the information. So are non-compete agreements legal? Yes, but they’re very persnickety. You have got to draft them carefully, maintain them constantly, and cultivate them with your employees to make sure your employees know about them.

From an employee standpoint, if you’re presented with a non-compete agreement, you need to have a lawyer look at it, evaluate it, and give you advice on the parameters of it. You need to know what it means, what it restricts you from and don’t just take someone’s word that all those things aren’t enforceable.

That can be a problem.

But there are strategies to help overcome those problems. And frankly, get you and the enforcing company where they need to be. So, I hope that answers the initial question, are non-competes legal? And again, if you enjoyed this, please share it with your friends. Share it on social media and I’m going to go out and get some justice.

Thank you, very much.

For more on our video bulletin segment, click here to access our full playlist on our YouTube Page! We have some older Facebook live videos in this playlist as well to help answer any question you have.

Make sure to also check out our full non-compete agreements blog page. Each blog about non-compete agreements will be in this section. Click right here to access our full non-compete collection.

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