Pennsylvanian workers like you may have been asked to sign a non-compete agreement before being officially hired into your current job. While these agreements are commonly used in the modern business age, many people don’t actually understand how they work, what they’re for, and how to determine if they are valid.
FindLaw states that a non-compete agreement has a few legal requirements that it must fulfill in order to be considered valid. This includes:
- Protecting legitimate business interests of the employer or person writing the contract
- Be supported by consideration when it is signed
- Be reasonable in terms of the time, scope, and geography that it covers
In other words, employers cannot simply force you to sign a non-compete agreement that bars you from working in your industry indefinitely. They cannot stop you from moving elsewhere to pick up similar work, either. For example, if you are working as a graphic designer, your employer cannot make the agreement too vague, such as barring you from doing any graphic design work elsewhere period.
Valid consideration, on the other hand, ensures that you get something in exchange for agreeing not to compete with the company that you have signed on with. By signing a non-compete agreement before being hired, however, the employment itself is usually counted as your compensation. However, signing a non-compete agreement after having already been employed still requires you to gain compensation, as promise of continued employment is not valid.
Non-compete agreements can be crucial for the well-being of a company. Because of this, it is equally important for employees to understand its importance and function within a company.
