Non-Compete (or Non-Competition) Agreements and Non-Solicit (or Non-Solicitation) Agreements, are contracts entered into by an employee and employer regarding future activities once the employment relationship has ended. These Agreements will be used to limit your future employment for a set period of time, whether it be in a selected field that directly competes with your former employer or by prohibiting your ability to leave and take employees or customers with you.
Generally, these agreements are governed by the state in which the contract is entered into, unless the agreement specifically dictates another state (choice of law provision). Massachusetts currently possesses no general non-compete agreement laws. However, it can be said that Massachusetts courts generally disfavor non-compete agreements and will err on the side of caution in favor of employees when disputes arise due to the fact that employer has a stronger bargaining position when entering into an agreement and the courts do not want to deprive an employee’s ability to earn a living.
When deciding whether a non-compete or non-solicit agreement are enforceable, the courts will look to determine the extent that they are necessary to protect the employer’s legitimate interests while not interfering with ordinary competition and only if “reasonably limited in time and space, and consistent with public interest.” As such, a covenant not to compete and other restrictive covenants must not be more restrictive than necessary to achieve its purpose.
If you are asked to enter into a Non-Compete Agreement or other restrictive covenant before you enter into your employment relationship, it is often a wise investment to have this agreement reviewed by a trained professional so that you understand the agreement you are making and its potential impact on your future employment. Likewise, […]