Everything You Need to Know About Non-Compete Agreements - BKL Law

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Everything You Need to Know About Non-Compete Agreements

Posted October 6, 2021 | Employment Law

At the start of a new job, you expect to receive a few different documents from your employer that you need to sign. One of these documents will likely be a non-compete agreement. You may have signed non-compete agreements in the past without understanding all the implications they can have. However, it’s important that you understand exactly what this agreement entails before signing.

Let our non-compete agreement lawyers address each one step-by-step.

1. What is a Non-Compete Agreement?

A non-compete agreement is a legal contract between an employer and an employee. It prevents the employee from competing with the employer for a specific span of time after the employment is over.

2. What is Included in a Non-Compete Agreement?

There are a few details that you need to ensure are in your agreement. This agreement should lay down the following:

  • What the employer deems as “working for a competitor.”
  • The time and geographic location covered.
  • If the employee will receive any compensation to offset the requirement.
  • The applicability of the clause if the employee is involuntarily terminated.

3. How Long are Non-Compete Agreements Valid?

Most employers see a six-month period as reasonable. As a general rule of thumb, the contract should not last more than what is genuinely required to protect the employer’s best interests.

4. What Happens When You Violate a Non-Compete Agreement?

Violating this agreement will generally result in your employer filing a lawsuit against you. The lawsuit may seek to:

  • Acquire compensation for any financial or actual losses suffered by the employer.
  • Enforce an injunction that requires you to leave your new employer and uphold the non-compete.

5. Are Non-Compete Agreements Enforceable in Your State?

The legal status of non-compete agreements varies by state. In New York, it is enforceable only if it seeks to protect the employer’s legitimate interests, causes no hardship to the employee, and is reasonable in terms of time and location.

6. How Can a Non-Compete Agreement Affect Your Career?

Non-compete agreements often lead to increased difficulties in finding jobs, especially in specialized industries, and reduced wages, among others. However, this doesn’t mean you cannot earn a living at all. Bear in mind that courts are reluctant to enforce extremely restrictive non-competes.

Additionally, some contain a payout clause, wherein the employer agrees to pay a set amount if the employee upholds the contract. This is not a standard, but may be included.

Most non-competes are also open to discussion. An attorney can help negotiate the terms of the contract as per your needs.

7. What to Do Before Signing a Non-Compete Agreement?

If your new employer asks you to sign a non-compete, turn to an employment law attorney for legal advice as soon as possible. Your attorney will inform you of the state laws, help you negotiate terms, and reduce the risk of a lawsuit.

Contact a Non-Compete Agreement Attorney Today

You don’t want to sign a non-compete agreement, only to figure out down the road that you’ve inadvertently harmed your future opportunities. At Brown Kwon & Lam, we know you’ve worked hard to get this far in your career and want to help you be sure a non-compete agreement won’t put it at risk.

Contact our New York attorneys today to get help.

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