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Understanding the enforceability of non-compete agreements

The need to hire and retain strong-performing employees is legitimate for Las Vegas area employers. The right workforce directly contributes to the success of a company. Similarly, problems with employees—either current or former—can negatively impact a company’s success. Such problems range dramatically and can relate to a contract dispute, unfair competition, fraud and more. Employer representation in employee complaints like these is important to protect the company’s ability to conduct its business.
Many employers request that some employees sign non-compete agreements. These contracts are intended to prevent an employee from going into direct, unfair competition with a company after leaving employment there. While the goal of these documents is to protect employers, many times such agreements are not upheld by courts. A recent news article provided guidance to companies to increase the rate of enforcement.

One recommendation is to use non-compete agreements selectively. Instituting them only with employees who truly have access to sensitive business information rather than making them standard for all employees can make them easier to use when needed. Additionally, these contracts should be separate from all other employment agreements or contracts. Companies should also make sure that the contract very clearly identifies what specific business interest is being protected.
Taking action promptly when business disputes between former employees and employers can help companies to ensure their interests are protected. When questions about these types of situations arise, an employer might wish to consult with an attorney. Gaining the perspective of someone experienced in this area of law can offer valuable information.

Source: The Business Journals, “How to improve your odds of enforcing a noncompete agreement,” Susan Trench, February 11, 2014

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