When is a non-compete agreement enforceable? It depends, as I was reminded the other day while sitting in courtroom as an expert witness.
Although not common place in the printing industry, we are seeing more and more firms who are “migrating” into the industry use them — and struggle. As is often the case, even in Texas and Missouri which permit non-compete agreements, the courts don’t go out of their way to enforce them. If the covenant is drafted in such a way as to preclude the employee from working at all within the industry, courts will not support the document. Thus, language stating that an employee could not work within 35 miles for any printing firm, or have terms much longer than 12 months, could be suspect. Courts will be friendlier to the agreement if it is specific. In the case of a sales rep, language that precludes the sales rep from calling on any accounts after they leave may not be enforceable, but language stating they cannot call on accounts developed while working under contract could be. But there are no guarantees. Ask any good business attorney.
Here’s a good article to review if you are considering — or using — a non-compete agreement. AND always have an attorney develop these agreements and review them on a regular basis. More importantly, remember that if you are going to enforce these agreements, you will end up in court. It won’t be cheap, and there’s no guarantee as to the contract’s viability.