Non Compete

Hello - my employer has made me sign a non compete which is very broad. It includes all the states in the US and all the countries in the world. The only place he missed is
District of Columbia. Could I start a business in DC?

I’d make sure (preferably with a lawyer) that it would be fine. I’d say you’re fine, however I’m not a lawyer. If he exclusively listed the places you CAN’T start a business, then you should be fine.

A non-compete should specify exactly what you are NOT to do under the agreement. Is your employer actually asking you to sign a non-compete that says ‘you can’t start a business everywhere in the world except DC’? I am doubtful of that.

It should also describe the term of the agreement and other conditions.

What is the exactly language that you are concerned about?

Check your state laws too. Employee non-compete agreements are pretty much invalid in California, for example.

[disclaimer]I’m not a lawyer[/disclaimer]

Many states have laws that limit the effect of a non-compete. For instance they cannot be so overly-broad to keep you from working anywhere. Further, non-competes are only valid if consideration is payed for the promise not to compete. Finally, if an employer is going to use the fact of granting a job as consideration they generally need you to sign a non-compete on your first day.

Many, many factors affect the non-compete. This is a serious contract - you should be serious about it too – it would benefit you to have a lawyer look it over.

Not an attorney, but most non competes are unenforceable outside of a very limited area (think city or county level). This is especially true if you have a degree or training in a very specific area. Bottom line is that you have to be able to make a living somehow.

With that being said, I would immediately question what the nature of such a broad non-compete is. This doesn’t sound like a mutual agreement from the start. Sure nobody intends for a relationship/employment/partnership etc. to end poorly, but you should not risk creating a major liability for yourself if things don’t work out.

Not necessarily true. A non-compete could reasonably have a broad geographic scope if the agreement were to limed the party to working in a very specific, niche space. I have signed NCA’s that prohibited me from working with a very specific type of technology/service within a specific industry for 2 years, and it had a ‘global’ scope. My attorney advised me that because we were signing the agreement between two corporations, because we had an extremely clear understanding of the rational and meaning of the agreement, and because there was considerable money coming my way is part of the overall agreement, that it would likely be enforceable (at least in the US).

True, it’s hard to get a non-compete in place that will put broad restrictions on someone, especially an employee, but there is more to it than that so it’s wise to seek counsel.

But whenever I sign a non-compete, I expect it to be written in fairly clear, plain English and typically I won’t need counsel unless there is something special in it.

I’ve never seen any figures so I can’t argue that most noncompete agreements are unenforceable outside of a very limited area, but that could lead to a dangerous assumption with respect to any particular agreement. You have to look at all the factors and the restrictions need to be reasonable. In some cases, a very broad geographic scope can be reasonable.

The bottom line is that the OP should consult with an attorney knowledgeable about non-competition agreements about his specific agreement and the relevant facts. A forum like this can only address broad generalities, even when the comments are coming from real attorneys.

Never sign a non-compete agreement, ask them if there is a specific company or two they don’t want you working for directly after working there. Say you are happy to sign a non-disclosure but to firmly shove, sideways, the non-compete. Help make the world a better place :wink:

Every vendor who works for me has to sign a non-compete that I’ve had written specifically to suit my business model.

You can refuse to sign non-compete agreements if you like, but they are common and they can be a good thing unless they are abused. If a client wants to make sure that you aren’t going to build something custom for them and then sell it to all of their competitors, they have the right to do that. If they are going to invest time and energy into educating you about a specific form of business, they can ask you not to transfer that knowledge to their competitors if they wish.

You aren’t obligated to sign it, and if you are losing business because of it then you should charge more for it.

But, to flatly refuse to sign a non-compete agreement seems arbitrary and ill-advised, and certainly doesn’t make the world a better place.

Trust helps any relationship. Starting with “I don’t trust you” isn’t helping anyone. You have a right to protect what you think is an original idea, however I’m yet to see an original idea - especially in this industry :wink:

Here’s hoping one day you will see the light! rather than the green.


He’s basically saying it’s not worth it, and don’t let money blind you.

I also commonly offered and signed non-compete agreements between my business and other businesses. I don’t think anyone involved thought there was necessarily any lack of trust between the parties, executing a non-compete was just a reasonable and prudent step before joining in a business relationship.

My earlier comment about enforceability was about Employer to Employee non-compete agreements, not business to business agreements.

[disclaimer] Same disclaimer about not being a lawyer [/disclaimer]

Not worth what? Who is necessarily damaged by singing a non-compete? Most of them work well for both parties.
I am not blinded by money, but I am happy to sign a non-compete under reasonable circumstances.

I should mention that I’m only speaking as to what I think he meant. That being said, I think he meant it’s not worth quarreling over a non compete just to potentially earn some more money. Just sign it .

I think this is quite different from my country, the government can not control it

It depends on what is stated there in your contract. Whether you may start or you can’t start a business in the said areas. Please specify…

Yes, i started a business for chemicals trading and even we signed an exclusive agreement with a manufacturer for the respective areas but they still sell their products to that areas. And at the end we can do nothing. I think the trade law in poor country is not strong and not fully complete yet.