An employer who abandons a particular customer, area of business, or product has no legitimate interest in the area it abandoned.
The following are likely to be considered legitimate business interests in most states that allow non-compete agreements: a. Valuable confidential business or professional information; c.
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Does it stink that companies can force employees to sign non-competes and use them as essentially indentured servitude? I see cases all the time of bully bosses using non-competes to force employees to stay under terrible conditions. If the employer breached the agreement by failing to pay all compensation due, failing to fulfill the insurance requirements, or failing to meet some other obligation, the employee may be relieved of all obligations under the contract. No legitimate interest to enforce: Many employers attempt to overreach their legitimate business interests, and this is one of the most common mistakes.
Or worse, cases where an employee quit their great job based on promises, then were presented with a non-compete after they start the new job. For instance, an employer has no legitimate interest in enforcing a non-compete against low-level employees such as receptionists and clerical employees.
I can't give legal advice here about specific situations but will be glad to discuss general issues and try to point you in the right direction.
Many employees think that, just because an employer forced them to sign the agreement or be fired, that they are not bound by a non-compete agreement. Continued employment is valid consideration for a non-compete agreement in some states, and almost all will enforce some non-compete provisions.
They stay a month or so, during which time the new employer uploads all their valuable contacts into the database. The laws need to change, so call up your state legislator and complain. In the meantime, can your employer enforce your non-compete? An employer who manufactures computer software for accountants has no legitimate interest in preventing an employee from working on software for doctors.
When the company gets what they need, they fire the poor employee, then say they can't work in their field for a year or two. An employer who is phasing out of an area has no legitimate interest in preventing an employee from working in that area.
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That’s because, unless you have a contract with the new employer spelling out that you can only be fired for cause, and that the non-compete is known to the employer and is not cause, most states are at-will states. Smart employees consult an attorney before signing a non-compete to be advised of their rights.