What You Need To Know About Non-Compete Agreements

Non-Compete Agreements

What You Need To Know About Non-Compete Agreements

If you own a business, there are things that you absolutely need to do to protect your business. One of these things is to have a non-compete agreement. Let’s talk about what you need to know about non-compete agreements and why it’s important that you protect your business.

What is a Non-Compete Agreements?

A non-compete agreement is a contract in which an employee agrees not to work for a competitor for some time after ending employment, or not to work in any competing field at all. Most people are familiar with non-competes from their professional career, but many entrepreneurs and business owners don’t know that non-competes can be used to protect you and your business as well.

Non-compete agreements can help prevent employees from leaving your company and joining competitors, taking clients with them. They also can help prevent employees who leave your company from poaching new employees while they look for other jobs.


Your business is only as good as the people you hire.

Strong employees are critical to your business’s success. If you’re not careful, they can also be a real liability. The wrong people will spell disaster for your organization, costing time and money and potentially harming your reputation. In contrast, hiring the right people will help you grow both in the short-term and over time, which is why it’s so important to put every effort into finding top talent.

You might think that a non-compete agreement would just be used by large companies with high-level hires on their payrolls—but nothing could be further from the truth!

A non-compete agreement can protect any type of small business owner when they hire new employees: from doctors who want legal protection against poaching by larger medical groups or hospitals; accountants who work for small bookkeeping firms; engineers at tech startups; retailers opening new stores; lawyers moving between firms etc. The list goes on! You can even use this agreement if you plan on selling part or all of your business someday down the line as an added layer of protection after things have settled down again after closing up shop permanently (or semi-permanently).


You invest in your employees.

There are several ways in which you invest in your employees. You invest in their salaries and wages, as well as their training, business knowledge and ideas. You also invest in their loyalty to your company.

Loyalty is important because it prevents resignations or departures that could result in a loss of productivity and revenue for your organization. It’s important for businesses to protect themselves against the threat of former employees using trade secrets or confidential information from previous employers against them once they have left the company.


Non-compete agreements are one way of accomplishing this goal, but there are other actions you can take as well. For example:

Your employees are a source of knowledge about your business.

As an employer, you are likely to have a variety of valuable information about your business that cannot be acquired by simply searching online. This includes:

  • Information about the value of your products or services.
  • Knowledge about industry trends and competitors’ plans and strategies.
  • Details on how to run your business more efficiently or profitably.
  • Customer lists and contact information, which can be very valuable in the hands of a competitor (i.e., if they sell similar products).

Non-compete agreements can be simple and easy to implement.

Non-compete agreements are easy to write and implement. They’re also easy for employees to understand and enforce. Furthermore, non-compete agreements can be modified or terminated as needed. So, if you’re looking for a way to protect your business with minimal hassle, a non-compete agreement is the right choice for you.


A non-compete agreement can protect sensitive information and trade secrets, helping your company stay competitive.

Protect from competitors: Your business may have developed unique products or services that allow it to compete with other businesses in the industry. If a former employee leaves your company with this knowledge, they could take it to another company and begin competing against you immediately.

Protect from former employees: If a former employee uses trade secrets or confidential information about your business after leaving, it could be harmful for your business. For example, if someone who used to work at McDonald’s opens up an identical restaurant within 100 miles of it and then starts selling their own brand of fries that taste exactly like McDonald’s fries (and they were never given permission), they’d be violating a non-compete agreement because those are the exact things protected by such agreements—trade secrets/confidential information about how something works or tastes!



If your non-compete agreement is violated, you may be able to take legal action.

If your non-compete agreement is violated, you have a right to sue the employee for damages and other financial penalties. Your attorney will advise you on the correct course of action in your given situation.

As a business owner, having a non-compete agreement in place gives you peace of mind that no matter what happens with an employee’s employment or departure from the company, they won’t be able to take your clients or customers along with them.


While non-compete agreements can be effective, they may not apply to every state or industry.

While non-compete agreements can be effective, they may not apply to every state or industry. In some states, non-compete agreements are generally disfavored and are not enforceable unless the employer has a legitimate business interest in protecting its confidential information.

Additionally, courts will take into consideration the scope of the agreement when determining whether it’s fair. If a non-compete agreement is too restrictive—such as requiring an employee to stay out of an entire market—it might be deemed unenforceable.

In addition, if you’re using a broad restriction that prohibits an employee from working for competitors in any capacity (including management roles), then it might also be deemed unenforceable by a court.


If you would like to protect your business’s right to be competitive and your employees’ right to work with you, consider using non-compete agreements.

If you would like to protect your business’s right to be competitive and your employees’ right to work with you, consider using non-compete agreements.

A non-compete agreement is a legal contract between an employer and employee that prevents the employee from working for another company in the same industry after leaving the company. This agreement can have many benefits for businesses and their employees:

Non-competes prevent competitors from stealing away your best employees.

Non-competes can help keep trade secrets safe from rivals who want them for themselves.

Non-competes ensure that any intellectual property created during the time period covered by the contract remains under control of its creator (i.e., you).



So if your business has trade secrets or a competitive advantage it wants to protect, then you should consider using a non-compete agreement to make sure that important information stays within the company.

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