Question:
I signed a non-compete agreement disallowing me to work in the
Security Industry for 1 year if terminated or resigning my position. I'm
now sorry I signed it as the company has changed corporate structure
dramatically and I don't like the changes. Are these agreements common in
the industry and more importantly, are they iron clad? I've been in sales
in the Security Industry for 17 years and pretty sure I can't make the kind
of money I do now (and must have) in an unrelated industry.
Answer:
Non compete provisions are enforceable, but only to the extent that the
provision is reasonable and necessary for the protection of the employer.
If the restriction is designed to trap the employee, would make it
difficult for the employee to work in the only field he knows, if the
employer doesn't really benefit by the provision, then the provision will
not be enforced. The non compete provision will only be enforced for a
limited time and a limited territory.
There are many elements to the issue that this question has not
addressed, so that a more specific answer is not possible. If an alarm
salesman has worked in the industry, in a particular territory, for many
years, has developed a following, is fully trained, gained little new
information or expertise on his new job, then it is unlikely that a non
compete can be enforced, especially if is overly broad. A NYC alarm
company cannot restrict a salesman from working in the USA, or even in all
of NY State.
The burden of proving that the restriction is reasonable and necessary
will usually be on the employer. The restrictive non compete is useful for
the employer because most employees will feel bound by the provision and
will be afraid to breach it. Also, prospective employers may be reluctant
to hire the employee knowing about the non compete because it could subject
the new employer to suit as well.
My standard employment contract does contain a non compete provision.