Why You Should Not Sign a Non-Compete Agreement

A non-compete agreement is a clause between an employer and an employee in contract form. It prohibits the employee, upon leaving the current job, from working in a business that would compete with the current employer.

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Disputes over Non Compeition Agreements

Disputing a non-compete agreement in court can be difficult since many courts don’t approve of these types of agreements. If the clause is reasonable, however, the court might uphold it. So as not to end up disputing the clause, at the time you are presented it, you should agree only to what is necessary to reasonably protect the employer and to get paid for the duration of the non-compete.

To Get Employment

When you are being hired by someone in a state that does not prohibit non-compete agreements, you can be required to sign one in order to get the job. If you don’t sign, you likely will not get the job. But that doesn’t mean you have to just blindly sign whatever is put in front of you. When you have one before you that seems unreasonable, you can simply attempt to negotiate for something less restrictive. Not all states accept any non-compete agreements as legal. Oklahoma is one state who refuses to enforce them. California states it is illegal for an employer to even ask an employee to sign one.

Deciding Whether or Not to Sign

You need to make the decision on whether or not to sign a non-compete agreement. You definitely should not sign one that extends for a long time and covers a wide regional area. This would make it impossible to find work once leaving the current employer. The non-compete needs to be reasonable. You’ll need to watch for it among the stack of papers you are given to sign when starting employment.

Legal Concerns

It is not always possible to foresee every circumstance and that is why it is smart to have a contract attorney look over any non-compete clause. They can ensure that all is aboveboard and you will not be taken advantage of.

Do You Get Paid During a Non-Compete Period?

So, do you get paid during a non compete? Something that is seldom thought of when first seeing a non-compete clause is whether or not an employee would be paid while the non-compete is in effect. The non-compete prohibits an employee from earning a living after leaving the employer. Being paid during a non-compete can be an important part of the clause and has advantages to both the employer and employee.

What is a Non-competition Agreement?

A noncompete agreement is a contract that is given to new employees upon hiring. It is a clause that the employee will agree to not work with a competitor in a similar position for a certain period of time. The time this will cover is typically from 6 to 24 months, depending on the business.

Why the Employer’s Do Not Pay

Employees would want to be paid during the time they are not allowed to work for a competitor because they will be limited in work they can do that won’t compete with their last employer. It solves the problem of finding a job that isn’t prohibited under the contract agreement.

Benefit for the Employee

It’s pretty obvious that the employee would benefit from such an agreement. They would be getting an income during the period laid out where they could not work in competition. It would also provide an incentive to the employee not to violate the clause and end up getting sued.

Benefit for the Employer

When the employer must consider that he will pay the employee for the duration set out by the clause, he will hesitate in making the time and geographic scope of the contract extensive. If the employer does need to enforce the agreement for any reason, he will have the contractual right.

What Happens When You Break a Noncompetition Clause?

So, what happens when you break a non compete agreement? Non-compete agreements is a contract that is between an employer and an employee. The signed agreement states that the employee agrees that he or she will not enter into a competition with the employer, either during the time of employment or afterwards. It prevents employees from entering professions or markets that are in direct competition with the employer.

Don’t Break the Non-Competition Clause

There are a number of things that may happen if an employee does violate or breach  non-compete agreements. It can also be that nothing happens for the violation. It seems that non-compete agreements are not looked upon favorably by the courts in most states. Due to this, you would want to ensure any noncompete agreement insisted upon by an employer be legally valid and enforceable under the laws of the state.

Legally Valid Noncompete Agreements by the Company

When you violate a legally valid agreement, it can cost you money. The employer can file a lawsuit against you and ask for money damages and you may have to pay your former employer. The employer can also ask for an injunction, which will force to you stop the violations due to breach of contract. Factually, the employer can also file a suit against your new employer. In this case, you will probably end up being fired from that job so that new employer can avoid litigation.

Consequences for Breaking Agreements

At times there is no action taken when you violate a noncompete agreement, and this would be when the employer would rather not go to the trouble of taking legal actions against you. Also if the agreement isn’t binding, it is possible you won’t suffer consequences.

They Should Consult an Attorney

It is important to have an attorney check your non-compete agreement prior to signing it. You want to ensure it is enforceable and binding. You also want to be sure you understand what the non-compete agreement is asking of you. They can be so restrictive that you wouldn’t want to sign it at all. Once reviewed by a contract attorney, you will know whether or not it is a wise idea to sign it and protect yourself for any future work.

Non-Competition Agreement Lawyer

When your physician contract is given a review by an experienced attorney, you will find financial benefits which end up outweighing the cost of the attorney review. Leave it to the experts. If you are in need of a review of an agreement or contract analysis schedule with a Non-Compete Agreement Review with Chelle Law today!