Non-Compete Contracts

[Gvac]

Hey Horde King,

What do you know about non-compete contracts? I signed one when I began working for my previous employer 3 & 1/2 years ago. It states that I cannot work in the same field for a period of one year after my resignation. Do they hold water? Would it stand up in court? Thanks.




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[HordeKing1]

GVAC - Non-competition clauses (a type of "restrictive covenant") are used all the time and are generally enforceable.

There are 3 main things the Court will look at if the covenant is challanged.

1. Does the employer have a proprietary interest entitled to protection
2. Is the temporal or spacial features too broad, and
3. Is the covenant unenforceable as being against competition. Sometimes a court will toss a non-competition clause if its just "too wacky," even beyong the time and/or distance part of the restriction.

Remember though, every contract and situation is different and applying the many rules to your particular situation takes expertise.

Hope this helped.

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[Gvac]

It did help, and I thank you. One thing I think may be my "way out" should I decide to stay in my current field is the third point in your reply:


3. Is the covenant unenforceable as being against competition.


In other words, if I had worked for McDonald's for the past several years and then quit to join Burger King, the non-compete would be unenforceable?




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Another one from the amazing Ms. germs!

[HordeKing1]

It's not quite so black and white. #2 is used to toss out some contracts. If it says that you can't work w/in 100 miles (too broad an area spatially), or for 25 years (way too long temporally), the contract is likely to be unenforcable.

Let's say that you worked behind the counter at McDonalds. And hypothetically you had to sign a non-compitition clause preventing you from working in anohter fast food place. If the only other fast food place around was Burger King, the contract could b considered unenforceable.

Again, it's not an easy area that can clearly be defined. The circumstances and exact wording of the contract make a big difference.

See a lawyer specializing in this particular area, if you have further questions.

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