Non-compete Agreements Need a Geographic Location

In a lawsuit between an employer and an employee, a non-compete agreement that restricted employees from “working for companies competitive with the employer” and “in locations where they employee marketed or sold products” was not reasonable in geographic scope nor was it defined well enough to be enforced. The court rendered it unenforceable leaving the employer without a remedy. This is one more reminder that non-compete agreements must be reasonable in both time and geographic scope. The guiding principle is the least restriction on the employee’s ability to obtain new job and reasonably necessary to protect the employer’s interest.

It may be a good idea to review your company documents with your attorney to be sure they will be enforceable when you need them.

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