In Tennessee, a covenant not to compete typically requires that, upon leaving the company, an employee agrees not to be employed by their employer's competitors. A covenant not to compete may also be called a "non-compete clause". An employee who signs a covenant not to compete may 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?
Whether or not a judge will conclude that the covenant is enforceable can be difficult to know beforehand. Even though the interests of an employer are important, Tennessee 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. Covenants not to compete that a court will categorize as unreasonable include provisions that last for a long duration or that restrict the employee to an unreasonable geographic area around Hendersonville.
Covenants must also be limited to restricting dealings with those competitors that are rationally related to the employer?s industry. Finally, the covenant not to compete must have a legitimate business purpose which is behind the employer's motivation for requiring the agreement.
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 Hendersonville, Tennessee lawyer to review any agreements. 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. Employers can receive useful advice from an attorney should they decide to sue a worker for breaching a covenant, and employees who have signed such covenants can also benefit from a lawyer's counseling.