Non-compete agreements have been a heavy topic of discussion in recent years, but they are still legal in Florida. A non-compete agreement is a legally binding contract between an employer and employee with the condition that the employee does not work for rivals should they leave.
How do non-compete agreements protect your business and when are they legally enforceable?
What do non-compete agreements protect?
The corporate world is notoriously competitive and it’s important to protect any advantage that you may have over rivals. This is where non-compete agreements can be useful.
A non-compete agreement can protect your intellectual property, such as trade secrets. An employee will not be able to join a rival firm and share information about your unique methods, technology and processes.
Non-compete agreements can also protect other sensitive information, such as your client lists and relationships with specific clients. If a rival becomes aware of your clients, they could attempt to go after them by undercutting you on price. Clients are typically receptive to non-compete agreements because they value confidentiality.
Legal enforceability
It’s important to note that non-compete agreements are only enforceable if they meet the legal requirements of the state. For example, a non-compete cannot be enforced forever. The contracts should specify a time limit. It’s unlikely that a court will enforce an agreement that goes on indefinitely.
Non-compete agreements also usually only apply to specific geographical regions. So, if an employee wants to move out of state or abroad and find work, it may be difficult for you to enforce a non-compete agreement.
Non-compete agreements can be beneficial when drafted correctly. We help businesses draft sound contracts, contact us for a consultation.