In Utah, a covenant not to compete usually 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". Compensation might be paid for employees who sign the covenant, or at times the employment might be conditioned upon such an agreement.
When are Covenants not to Compete Unenforceable?
It is difficult to discern whether a judge will enforce a given non-compete agreement. While employer's interest are important, the courts of Utah also put a high level of importance on a person's ability to pursue their desired employment opportunities. Consequently, a court will generally only uphold non-compete clauses which under the circumstances are considered to be reasonable. A court will typically hold non-compete clauses to be unreasonable if they involve unusually long periods of time or if they cover a geographic region surrounding Taylorsville 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?
Before you sign any provisions that could restrict your rights, you may consider hiring a Taylorsville, Utah attorney who can review the covenant. The attorney can negotiate modifications to the contract if they are needed, and can draft a new clause which is acceptable to the parties involved. 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.
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