The Basics | Employer’s Rights | Employee | Elements to Prove | Recoveries | Defenses | Trade Secrets | Procedures and Injunctions | Employment Issues | Settlement Options
Is extremely difficult for a business to compete in the market place if other businesses steal employees and trade secrets to get an unfair advantage. The employer has a right to prohibit certain types of employees (such as sales people, management, innovators, policy makers, etc.) from competing or assisting competitors so long as the restrictive agreement is reasonably limited in scope and time.
A Well-Drafted Agreement
From the employer’s perspective, it is exceedingly important that the non-compete be drafted precisely and narrowly to meet the employer’s objective. Otherwise, the courts will not enforce the agreement.
It also helps to give the employee incentive to obey the non-compete, such as making severance packages payable in stages based upon non-competition, for example.
Recovering Damages
It is virtually impossible to quantify the damages sustained from unfair “competition.” For this reason, the courts will restrain or “enjoin” an employee from improperly competing as there may exist no adequate remedy at law. That said, the employer can and should include in the non-compete agreement the right to recover attorney fees and costs of litigation. The employer should also build into the agreement the costs of training an employee if those can be quantified.
Free Consultation
We offer a free consultation to employees (defending against enforcement) and employers trying to protect their rights against improper competition or dissemination of trade secrets.