Many employees sign confidentiality and non-compete agreements when accepting a new job. While the stack of on-boarding paperwork for a new job seems routine, the obligations included in these non-compete agreements are anything but routine.
Employees must carefully understand and consider the obligations imposed by these agreements, especially because they generally apply whether an employee voluntarily terminates employment or the employer involuntarily terminates the employee. In other words, re-employment options are restricted whether you quit or are fired.
What can you do? The employee can try to narrow the scope of the non-compete agreement so that if it protects the new employer’s interests but does not impose unreasonable restrictions that could hamper the ability to find a new job. Revisions can also be added to specify competitors that the non-compete applies to rather than an entire industry. A non-compete will be unenforceable if it inhibits an employee’s ability to earn a living because there are no realistic employment options given the non-compete’s restrictions. The non-compete will be more enforceable against an employee who leaves to start up a competitor business.
Employees should carefully review any agreements he or she will be required to sign to accept the job, reflect on its impact, and seek professional advice if concerns arise.
Tracy Jong has been an attorney for more than 20 years, representing restaurants, bars, and craft beverage manufacturers in a wide array of legal matters. She is also a licensed patent attorney.
Her book Everything You Need To Know About Obtaining and Maintaining a New York Retail Liquor License: The Definitive Guide to Navigating the State Liquor Authority will be available next month on Amazon.com as a softcover and Kindle e-book.
Her legal column is available in The Equipped Brewer, a publication giving business advice, trends, and vendor reviews to help craft breweries, cideries, distilleries and wineries build brands and succeed financially.
She also maintains a website and blog with practical information on legal and business issues affecting the industry. Follow her, sign up for her free firm app or monthly newsletter.
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Tracy Jong Law Firm