Running and navigating a business or other large organization is complex. There are a variety of factors you have to consider in order to be successful and maintain the quality of your production as well as the happiness of your employees.
One of these factors includes the implementation of non compete agreements. These types of contracts have various positive and negative attributes, so it can be difficult to decide which way to go. Here is a brief and basic outline of the world of non compete agreements.
What Is A Non Compete Agreement?
A non compete agreement can encompass a wide range of conditions. Most traditionally, they protect businesses from losing employees and trade secrets to competitors. Non compete agreements can prevent former employees from sharing company secrets, methods and product details in order to protect the company.
These types of contracts are widely used across the nation. It’s reported that approximately one out of five employees are currently bound by a non compete agreement.
What Are The Pros?
Due to the nature of these agreements, there are several positive reasons to use these types of contracts. They protect company and trade secrets and intellectual property as well as keep former employees from creating close competition for your business.
Non compete agreements can also help you retain good employees. Employees under a non compete agreement might be less likely to leave or more likely to stay for a longer period of time.
What Are The Cons?
There are also several business disadvantages of these types of agreements. For one, they are limited and cannot encompass too large of a range of time, area and subject matter. They must be reasonable, and so they cannot be too restrictive to the employee. They also can be expensive to enforce. Legal fees involving non compete litigation can be high.
In some cases, these agreements can discourage employees from working for businesses requiring non compete agreements. Some employees may not want to be limited or feel restricted by such agreements.
It’s important to consider both the pros and cons of these types of contracts in order to decide what is best for your company. Consulting an experienced attorney can help when sorting out these matters and creating non compete agreements if you decide it’s a good fit for your company.