How Does a Non-Compete Work?

by | Dec 29, 2022 | Blog

How does a non-compete work? If you own a business and you want to protect your interests, this article will help you decide whether having your employees sign a non-compete agreement is right for you.

A non-compete agreement is a term given to an individual’s agreement not to work for a company that would cause conflict with their current employer’s business. Non-competes are used in various fields and usually provide that the worker agrees not to join a competing enterprise or be involved in some way with the operation of such an enterprise.

Non-competes are typically used to protect an employer’s business interests, such as trade secrets, confidential information, or special relationships with customers. Non-competes can also be used to protect an employer’s investment in an employee’s training and development.

Learn more about how does a non-compete work, what information you need, the length of time they are enforceable, and some ideas on how to enforce a non-compete agreement. 

Who Can Sign a Non-Compete?

The signing of a non-compete agreement is often a requirement for employment. However, there are some exceptions to this rule. For example, if an individual is hired as a consultant or independent contractor, they may not be required to sign a non-compete agreement. Additionally, some courts have held that non-competes are unenforceable against employees who are terminated without cause.

If you’re considering signing a non-compete agreement, it’s important to understand what you’re agreeing to. Non-compete agreements are contracts that prohibit employees from competing with their employer during and after their employment. Non-competes can also be enforced against former employees who leave the company and try to start their own competing business or join a competitor.

Non-competes are typically only enforceable for the duration of the employee’s employment plus a reasonable period afterward (usually six months to 2 years). However, some courts have held that non-competes can be enforced for more extended periods if they are reasonably necessary to protect the employer’s legitimate business interests.

To be enforceable, a non-compete must be reasonable regarding its scope and duration. It should also be signed by both parties and by witnesses, if possible.

How Does a Non-compete Work?

There are a few key things to understand about non-competes. First, they are only enforceable if they are reasonable. This means that the geographic scope and time period cannot be too broad or too long. Second, courts will not enforce a non-compete against an employee who is fired without cause. And finally, employers must give something of value to the employee in exchange for signing a non-compete – this is usually continuing employment.

If you are a business owner creating a non-compete or an employee sued for breach of a non-compete, it is important to consult with an experienced attorney who can evaluate your case.

What Do You Need When Creating A Non-Compete?

If you’re thinking about creating a non-compete clause for your business, there are a few things you’ll need to keep in mind. First, you’ll need to make sure that the language of the clause is clear and concise. You want to create a document that’s clear and easy to understand.

Second, you’ll need to be aware of the laws in your state regarding non-compete clauses. Certain states have restrictions on what can and can’t be included in a non-compete agreement. Be sure to check with an attorney to determine the laws in your area.

Third, you’ll need to ensure that you have solid evidence to back up any claims made in the agreement. For example, if you’re claiming someone will steal your clients if they leave your company, you’ll need proof to back that up. Without evidence, your non-compete clause may not hold up in court.

You must also include the following information when creating a Non-Compete Clause:

  • The names and addresses of the participants (both the Protected Party, or the party requesting the agreement and the Noncompeting Party, or the party who is being prohibited from working for a competitor)
  • The agreement’s effective date and duration
  • The rationale behind the agreement
  • The geographical scope of the agreement
  • The “consideration” or compensation for signing the agreement
  • The names of those who will sign the agreement

How to enforce a non-compete in Florida?

If you suspect that an employee or former employee is violating the terms of their non-compete agreement, you must take action to enforce the agreement. This could include a variety of approaches or steps, depending on the circumstances.

Notify The Employee

First, you must remind the employee of their non-compete agreement obligations. Make sure to emphasize the post-employment restrictions included in the non-compete during exit interviews.

You can send a cease-and-desist letter if an employee appears to be ignoring their non-compete agreement. To avoid further enforcement action, you should instruct the employee in the letter to cease all competitive activities.

Make Contact With The New Employer

You can also get in touch with the employee’s new employer. A new employer is frequently unaware that an employee has signed a non-compete agreement. Many employers will stop using that employee for competing activities once you inform them.

Implement An Enforcement Action

If the employee continues to violate the non-compete agreement, you may have to enforce it through arbitration or in court. You may be entitled to an injunction to prevent the employee from engaging in competitive business, depending on what you specified in the agreement.

In Florida, you may also recover monetary damages for breach of the non-compete agreement. Be aware that the arbitrator or judge will look to the Florida statute on non-compete agreements to determine whether the agreement is enforceable.

For Non-Compete Agreements, Contact Saltiel Law Group

Your non-compete agreement may be void and unenforceable if it is not properly drafted. So, if your company is worth protecting, hire Saltiel Law Group’s experienced employment lawyers so we can help you know more about how a non-compete works and how to draft your non-compete agreements.
We can assess your business interests and draft contracts that will stand up in court. Contact us today so that we can work together to take advantage of the Florida non-compete statute.