Kaufman & Forman, P.C.
Call to arrange a consultation
678-957-7769 | 770-390-9200
Contact Us
practice areas

Reasonableness is key in noncompete agreements

Non-compete agreements can be crucial documents for business owners. These agreements can help mitigate the risk of a former employee accepting a job from a competitor or starting their own business that directly competes with yours. But as useful as non-compete agreements can be for employers, they can be legally tricky to enforce.

There have been several instances in which judges have struck down non-compete agreements for being too restrictive. A court’s decision can vary widely depending on each case’s unique circumstances. Several factors can come into play. But there is one factor that is important above all others when it comes to non-compete agreements: Reasonableness.

Reasonableness

To be upheld in court, a non-competition agreement’s restrictions must be reasonable. A non-compete cannot impose restrictions that are too burdensome to the signatory. A good contract will balance the employer’s business interests with the employee’s ability to earn a living. A court will consider three factors in particular when assessing whether a non-compete agreement is valid.

  • Duration of time

A contract may only impose restrictions on an employee for a reasonable amount of time. A judge will not uphold a contract that bans an employee from doing similar business for the rest of his life.

  • Geographic area

Many agreements prevent employees from doing business in the same area as their former employer. But this geographic area must be reasonable. Prohibiting an employee from working within the same city as a former employer may be reasonable; prohibiting them from working on the same continent is not.

  • Scope of work

The scope of work to which an employee is limited must also be reasonable. If an employee’s options are too thoroughly restricted, he may not be able to make an adequate living. If a court determines that this is the case, it will likely throw out the agreement.

No Comments

Leave a comment
Comment Information

Contact Kaufman & Forman, P.C. Now

Bold labels are required.

Contact Information
disclaimer.

The use of the Internet or this form for communication with the firm or any individual member of the firm does not establish an attorney-client relationship. Confidential or time-sensitive information should not be sent through this form.

close

Privacy Policy

get Legal Help Now

Kaufman & Forman, P.C.
8215 Roswell Road
Building 800
Atlanta, GA 30350

Toll Free: 800-461-5864
Phone: 678-957-7769
Fax: 770-395-6720
Atlanta Law Office Map

Review Us

Robert Kaufman has been selected as a 2013 Top Rated Lawyer in ‘Commercial Litigation’ as will be published in the May issue of The American Lawyer & Corporate Counsel magazine.Alex Kaufman has been selected as a 2013 Top Rated Lawyer in ‘Commercial Litigation’ as will be published in the December issue of The American Lawyer & Corporate Counsel magazine.

*AV Preeminent and BV Distinguished are certification marks of Reed Elsevier Properties Inc., used in accordance with the Martindale-Hubbell certification procedures, standards and policies. Martindale-Hubbell is the facilitator of a peer review rating process. Ratings reflect the confidential opinions of members of the bar and the judiciary. Martindale-Hubbell ratings fall into two categories: legal ability and general ethical standards.