Valid noncompete agreements

| Feb 2, 2021 | Uncategorized

A noncompete agreement is a contract prohibiting someone from working for a competing business for a certain amount of time. In most circumstances, courts will enforce noncompete agreements. However, individuals in Georgia and other states should know some of the factors that can impact the reasonableness and enforceability of a noncompete agreement.

Duration

Enforcing a noncompete agreementis feasible only if it lasts for a reasonable amount of time. The reasonableness of the duration depends on the industry and circumstances for which the noncompete governs. In most instances, a noncompete agreement of a year will be reasonable and enforceable, but clients should consult with an experienced civil litigation attorney to see if they can have a noncompete agreement last longer.

Geographic scope

Courts will only enforce a noncompete agreement if the contract restricts work within a limited geographic area. Reasonableness will often depend on the type of area. For example, ten square miles is different in rural setting than it is in an urban center. Moreover, the type of industry will also impact whether a geographic area is reasonable

Public interest

Some fields are so important to the public good that courts do not wish to enforce onerous noncompete agreements involving those industries. If a noncompete involves one of these, parties may need to prove that the terms of the agreement are especially reasonable in order to have them enforced. Depending on the circumstances, courts might be willing to scrutinize the fields of science, medicine and other industries more closely.

Unrestricted negotiation

Courts are more likely to find a noncompete agreement is reasonable and enforceable if it is part of an arms-length negotiation. If employees sign a noncompete agreement involuntarily, the noncompete may not be valid. Due to complexities involving these contracts, it is important to speak with legal counsel when dealing with them.