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The basics of noncompete agreements

On Behalf of | Apr 5, 2021 | Uncategorized |

When you start a new job in Pennsylvania, you will likely sign a lot of paperwork your first day. One document your employer may ask you to sign is a noncompete agreement. The following is a brief overview of noncompete agreements, but as always, this post is for educational purposes only and does not offer legal advice.

What is a noncompete agreement?

A noncompete agreement is essentially a contract between the employee and the employer. The employee agrees not to engage in direct competitive activities while employed with the employer. It also prohibits an employee from working for a competing business after leaving employment with the employer for a certain time period.

Why do employers benefit from noncompete agreements?

Employers often have intellectual property, sensitive information about operations, business strategies, formulas and client lists. A noncompete protects employers by prohibiting employees and former employees from revealing this information in a way that damages the employer.

What clauses should a noncompete agreement include?

As it is a contract, it is essential that a “meeting of the minds” between the employer and employee exists when the document is signed. In addition, there are several key clauses that should be included in a noncompete agreement. One is a specific date on which the noncompete agreement will start running. The reason for enacting the noncompete agreement should also be included. Specific dates in which the employee cannot engage in competitive activities and the geographical scope of the noncompete agreement are two other clauses that should be included. Finally, a noncompete agreement should contain details on employee compensation for agreeing to the terms of the agreement.

Learn more about noncompete agreements

Noncompete agreements are legal contracts that can have a significant effect on a worker, both during and after employment. As such, it is essential that workers understand the terms of the agreement before signing one. Our firm’s webpage on noncompete agreements may be of interest to those who want to learn more about this topic.