Making legal and financial plans for the future is a deeply personal process that depends…
When you work hard to achieve a goal, you certainly want to receive your due credit. Additionally, you do not want someone else using your hard work or taking credit for your work for personal gain, especially in the business world. The actions you take may make or break your company, and when tactics help your business thrive, you want to protect your information.
In order to protect your intellectual property and other important business interests, you may want to limit the opportunities to spread that information. One way in which you could work do to this is by having your employees and other pertinent parties sign non-compete agreements. These agreements often need to have various details in order for everyone to understand the contract and for it to remain enforceable.
What should your agreement include?
First, you may want to make sure that you actually could benefit from such an agreement in the first place. If your company has unique aspects or interests that could need protecting from competitors, having this contract may benefit you. However, if you simply want to have this type of contract in place on the off chance that you may one day have trade secrets to protect, the document will likely not hold up if challenged.
If you do feel that a non-compete agreement could suit your business needs, you may want to include the following information:
- Reasonable time period during which a former employee cannot work with competitors
- Restrictions that remain within a reasonable scope, meaning you want to bar someone from working in a specific position in a specific area
- Reasonable geographical area within which you want to limit the former employee’s ability to work
The key word here is “reasonable.” While you may want to go to great lengths to protect your IP or other information, you cannot attempt to restrict someone from competing with your company for 15 years across five states in any position that may have a slight connection to the work he or she performed for your business. Instead, having terms that work to protect your business but do not cause undue hardship or limitation on employment opportunities may work more in everyone’s favor.
What else should you know?
If you want an employee or prospective employee to sign a non-compete agreement, you need to offer some sort of incentive. If you want a new employee to sign, giving him or her a job typically acts as enough incentive. However, if you want a current employee to sign such an agreement, you may need to offer additional pay or other similar benefits.
In the event that someone breaches this contract, business litigation may prove necessary. It can be a complex endeavor to face, but fortunately, you can have legal professionals on your side.