Defining “Non-Compete” OR “Non-Solicitation” Agreement
Whether you are new in the job market or an experienced individual with adequate work history, there is always the pressure to sign non-compete and non-solicitation agreements. If you have been asked to sign the same, then you must know the non-compete OR non-solicitation clauses before formally accepting anything.
- A non-compete agreement is an employment contract that companies usually ask to secure their business interests. According to the non-compete clause, an employee is not allowed to work for a competitor for a certain period and in a certain region after leaving the organization. Any violation of the contract can result in serious litigations.
- A non-solicitation agreement is aligned to avert an employee from poaching confidential business data, key clients, suppliers, vendors, contracts, or other employees from the organization. The non-solicitation clause prevents a company’s employees from passing information that an employer wants to secure in the long run.
Why Do Employers Require Employees to Sign?
Many businesses require their employees to sign the aforementioned agreements to avoid the loss of important customers and the company’s private data. Organizations aim to protect their trade secrets and imperative business information to gain an edge over rivals within a specific industry. Through No compete or non solicitation agreements, companies happen to protect their substantial customer relationships to ensure overall business growth.
Negotiating Your Contract
If you have been asked to sign a non-compete OR non-solicitation document, then you must prepare yourself to discuss every point with your employer. You and your employer both have to fully understand the documents to ensure mutual benefits and avoid excessive baggage. You need to understand the additional scope of the agreement. For instance, if an employer asks you to sign a document with geographical limitations, then you may want to argue on shortening the period of the clause.
Do You Need a Lawyer?
When it comes to non-compete or non-solicitation agreements, you need to have proper legal assistance on your end. You don’t want to put yourself at stake by signing the documents without realizing their advantages and disadvantages. You are signing a legally binding contract and that’s why it is vital to seek legal counsel. Your employment contract lawyer will help you understand non-compete or non-solicitation clauses on better grounds.
When Are Non-Compete OR Non-Solicitation Clauses Unenforceable?
There are times and situations when non-compete OR non-solicitation agreements are unenforceable. Non-compete or non-solicitation clauses are not legally enforceable when:
- Business interest has not been violated
- Not violated any public policy
- The employee was wrongfully dismissed/terminated
- The employee didn’t receive anything in exchange
- There is ambiguity in terms of geographical limitations
- There is ambiguity in terms of time duration
- There is not clearly mentioned the scope of restrictive activities
- The agreement is vague on multiple grounds
The Bottom Line
If your employer is willing to bound you with non-compete OR non-solicitation agreements, then you must take your time to understand the clauses. It is best to hire a lawyer who holds superior knowledge of the field and can advocate on your behalf.