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What employers need to know about noncompete agreements

A noncompete agreement prevents an employee from working for a rival business after he or she leaves a Florida employer. Such agreements usually restrict the employee’s ability to take a position with a competitor for a certain amount of time and in a certain geographical area. They can either be standalone agreements or can be included as part of an employment contract if there are also other terms being agreed to between the employer and employee.

Employers who wish to restrict former employees’ ability to work for a similar business will want to keep a few things in mind when asking someone to sign this type of contract. For instance, HR Daily Advisor points out that potential employees may be turned off by a noncompete agreement and existing employees may opt to leave rather than execute one. In addition, any disputes that arise as a result of the agreement will most likely end up in court.

However, if an employer is concerned that an employee could take important information with them should he or she leave for a competitor, a noncompete agreement may provide some assurance against that happening. Also, such a guarantee may help an employer by protecting the time and training it has invested in its employee.

The biggest concern employers should have about this type of agreement is whether or not it is enforceable in court. According to the Florida Legislature website, contracts such as noncompete agreements that restrict the ability of an employee to work for a competitor are enforceable in Florida as long as they protect legitimate business interests and are considered “reasonable” in terms of the time and location of the restrictions. Such agreements must also be put into writing.

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