Generally, a covenant not to compete is when a Alabama employee agrees not to work for an employer's competitors when the employee leaves the company. Covenants not to compete are also known as "non-compete clauses". An employee who signs a covenant not to compete can receive compensation for the agreement, or in some cases the agreement is a condition for their being hired.
When are Covenants not to Compete Unenforceable?
Foreseeing whether or not a judge will uphold a covenant not to compete is generally difficult. Even though the interests of an employer are significant, Alabama courts value a person's freedom to select the type of employment that they desire. Thus, courts will typically uphold only those covenants not to compete that they conclude to be reasonable. Those agreements that courts have seen to be unreasonable include those that last for an prolonged period of time or cover geographic areas around Alexander that are unreasonably large.
Non-compete clauses are also limited in that they may only apply to competitors who are rationally related to the industry of the employer. Finally, the employer needs to have an acceptable business purpose which justifies their motives in requiring their employee to sign a covenant not to compete.
Do I Need an Attorney when Dealing with a Covenant not to Compete?
You might want to hire a Alexander, Alabama lawyer to review the covenant before signing any provisions that may limit or restrict your rights. The lawyer will then be able to negotiate any modifications to the contract as needed, or they can even draft a new one should it be required by one or both parties. An attorney can also give valuable advice when it comes to suing employees for breaching covenants, or counseling employees who have signed one regarding whether they can accept a different job.