Kajko, Weisman & Colasanti, LLP

Tips for drafting an enforceable noncompete agreement

As a Massachusetts small business owner, you probably have certain processes, routines or trade secrets that give you an edge over your competitors. While these routines, processes or trade secrets are undoubtedly valuable to your business, they can also cause it harm if they fall into the wrong hands. At Kajko, Weisman & Colasanti, LLP, we recognize that carefully crafted noncompete agreements can help you protect your business's bread and butter, and we have helped many Massachusetts business owners take steps to safeguard their private information.

According to Entrepreneur, crafting and having your employees sign noncompete agreements is one thing, but making sure those noncompete agreements are actually enforceable is entirely another. In other words, while you can certainly set guidelines in your agreement that dictate what you expect from your employees in terms of discretion, you must exercise extreme care in doing so if you want the agreement to hold up in court.

So, what steps can you take to increase the chances of your noncompete agreement being enforceable? First, you will want to be extremely specific in your agreement with regard to your industry and the specific duties and training received by your employee. Your agreement cannot simply prohibit competition - instead, it must carefully detail what it is about your worker that would give him or her an advantage, if he or she were to leave your company and sign on with a competitor. This might include specialized training, access to trade secrets and the like.

It is also important that you exercise reason when creating your noncompete agreement. For example, if you operate a small company that only serves its immediate geographic surroundings, avoid including language in your agreement that bans workers from conducting business nationwide upon leaving. Similarly, be careful when determining how long you want to bind your employee to the terms of your agreement. If your terms are unreasonably long, a court may consider the entire agreement invalid and unenforceable. Find more about employment contracts on our web page.

 

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