Honest.
Approachable.
Responsive.

Michelle Cohen Levy

How noncompete agreements protect businesseses

On Behalf of | Jul 20, 2022 | Employment Law |

To run a successful business, you need to focus on immediate needs while having the foresight to protect long-term goals. This is a challenging process, which is why many businesses put off planning for the future.

Such procrastination can be costly, though, which is why you need to do everything you can on the front end to protect your business.

One way to do this is to use noncompete agreements.

What is a noncompete agreement?

Noncompetes are contracts between employers and employees. The contracts protect businesses from employees working for direct competitors.

Terms typically are negotiated with prospective employees who will have access to sensitive information about the business. This could be anything from marketing strategies to production processes.

Limitations of noncompete agreements

The law places limits on noncompete agreements. To be enforceable, the contracts must pass these tests:

  • The geographic scope must reasonable
  • The type of work being restricted must be reasonable
  • The length of the agreement must be reasonable

For example, let’s say you are a smaller business that has a strong presence in the Miami area but no further. In this case, a noncompete that prohibits a former employee from working nationwide or even statewide outside of Miami might be unenforceable.

Help is available

Successful business planning requires a keen eye for detail not just during the startup phase, but also as you try to grow your business. Failing to properly address the plethora of issues you might face can cost you a lot of time and money while at the same time damage your brand and goodwill.

To negotiate strong and enforceable noncompete agreements, consider reaching out to an attorney who is experienced in this area.