COMPLIANCE
Developing a Non-Compete Implementation Strategy By ROBERT W. HORTON
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f your business does not have non-compete agreements in place but would like to develop one, what are the options and best practices you should consider? The jumping-off point for consideration is understanding that non-compete agreements are generally disfavored as a matter of public policy because individuals are being restricted in their opportunity to find work and support themselves. The public policy issue results in different approaches toward non-competes in every
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state. Even in the states viewed as most favorable toward the enforcement of non-competes, courts will require (as a matter of common law or statute) that the employer have a protectable interest that justifies non-compete restrictions (e.g., confidential information provided to employees, goodwill created by the employees and specialized training given to employees). In those states, the scope of non-competes related to duration after the termination of employment and geographic reach must also be limited only to what
NOVEMBER 2022
is reasonably necessary to defend those interests. For non-competes arising out of an employment relationship, even in these favorable states, courts may enforce an agreement for up to two years in the geographic area served by the employer during the employment relationship. Such favorable courts, however, often will limit enforcement of the non-compete to a shorter time period and only the geographic area where the employee actually provided services. In less favorable states, non-competes BACK TO CONTENTS
