When business owners hire new employees, they may need these employees to sign a noncompete agreement. There are several elements people need to include in these agreements if they want them to be valid.
A noncompete agreement protects the interests of a company. FindLaw says that when people sign these documents, they agree to refrain from working for a competing company for a certain amount of time. The agreement lays out several terms an employee has to follow.
Use specific restrictions
A noncompete agreement has to include parameters about the geography of the agreement. Employers may want to bar their employees from working at any competing company in Texas. However, business owners may not have customers across the entire state. They usually cannot keep employees from taking a job in areas where the company does not work.
Additionally, employers need to make sure the noncompete agreement lays out specific expiration dates. Many agreements only last for a few years. The length usually depends on the type of information an employee could access. Some specialized information may only be valid for a few years. A noncompete agreement may need to expire when this information is no longer valid.
Include the fine details
According to Entrepreneur magazine, a noncompete agreement has to include information specific to each employee. Employees may receive specialized training for their position. A noncompete agreement might specify that people cannot pass on these skills at their new job. Additionally, employers may want to add a clause stating that people cannot encourage customers to follow them to a new company.
Employers should remember that all the terms of a noncompete agreement have to be reasonable. This document may not be valid if an employer includes exorbitant restrictions.