Noncompete agreements need the right terms for enforceability

Running a business means that company owners have many concerns to consider. Though Pennsylvania business owners may need to bring in employees to help stay on top of operations, they may worry that those employees may choose to leave the company later and work for a competitor. Often, this concern results in employers utilizing non-compete agreements in hopes of preventing that outcome.

These types of agreements often put restrictions on an employee in efforts to prevent that employee from joining a competing company soon after leaving a business. The agreement can stipulate a length of time during which the employee cannot work for a competitor, the region in which that person cannot work and the type of employment position that the person cannot take on. However, if such an agreement is too restrictive, it could be deemed invalid.

In efforts to avoid creating an invalid agreement, employers may want to carefully go over the terms. For example, when restricting the area in which a former employee could work, it is wise to keep that geographical area to a reasonable limit in which a company’s business interests could be affected. Indicating that a former employee cannot work in a specific position within 10 surrounding states may be overkill and unenforceable.

While it is wise to consider the use of noncompete agreements, it is important that Pennsylvania employers create them correctly. The documents need to have a narrow scope, comply with state regulations regarding such agreements and have suitable terms. Interested parties may want to work with experienced business law attorneys who could help draft these agreements.