In general, covenants not to compete involve an employee in the state of Michigan who agrees not to work for competitors of their employer when they leave the company. Such covenants are often called "non-compete" clauses". Signing such an agreement can either be a condition for being employed, or the employee may receive additional compensation for doing so.
When are Covenants not to Compete Unenforceable?
Foreseeing whether or not a judge will uphold a covenant not to compete is generally difficult. Although the interests of employers are significant, courts in Michigan also give importance to an employee's freedom to choose the type of employment that they desire. As a result, courts usually uphold only those covenants that are consider to be reasonable according to the circumstances. A court will usually hold non-compete clauses to be unreasonable if they involve unusually long periods of time or if they cover a geographic region surrounding Farmington Hills that is excessively 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 must have a legitimate business interest behind its motivation for mandating a covenant not to compete.
Do I Need an Attorney when Dealing with a Covenant not to Compete?
Since covenants could restrict your rights, you may wish to hire a Farmington Hills, Michigan lawyer to review any documents. They will be able to negotiate further changes to the covenant, and can draft an entirely new one that is acceptable to all parties if needed. A lawyer can also render useful advice for employers who are contemplating suing an employee for breach of covenant, or they can counsel employees who have signed such an agreement.