Non-compete agreements are common for certain professions in Boston. They are designed to protect the interests of a business owner, so an employee cannot share company secrets or practices with a competitor should that employee suddenly switch jobs.
However, that does not mean that an employee does not have any rights when it comes to non-compete agreements. Massachusetts state law has specific guidelines and restrictions that an employer must honor when introducing non-compete or separation agreements to their workers.
If you are asked to sign an employment contract, but you’re not sure if the non-compete agreement is fair or in your best interests, then it’s paramount that you reach out to an employment lawyer who is familiar with federal and state laws. At HKM Employment Attorneys, our entire practice is dedicated to employment law and helping local workers protect their rights.
We’ll help review your contract to determine if the non-compete agreement is fair or if your employer is making illegal or unreasonable demands.
Are You Subject to a Non-Competition Agreement?
Employees may be asked to sign a non-compete agreement in the following cases:
- Business sales: After selling the business, the sale contract may include a provision that the seller won’t compete with the buyer for a given period.
- Technology companies: Companies developing and selling technology products and software often include non-competition agreements to protect trade secrets.
- Company executives: High-level PLLC company executives are also subject to non-compete agreements due to their specialized and extensive knowledge of company operations.
- Franchise agreements: Franchise agreements also include a non-competition clause to protect trade secrets and business plans.
On the other hand, Massachusetts legislation bars the use of non-competition agreements in the following professions:
- Social workers
Note that non-compete agreements are quite different from non-solicitation agreements. Unlike non-compete agreements, non-solicitation agreements do not prevent the former employee from working for direct competitors but prohibits them from soliciting clients and employees from the former employer.
Are Non-Compete Agreements Enforceable in Boston?
The state of Massachusetts has strict guidelines when it comes to non-compete contracts in the workplace. For both employees and independent contractors, business owners in Boston are required to follow these stipulations in order for their agreement to be legal and enforceable:
- The agreement should be in writing.
- Both parties, employer and employee, should sign it.
- It should state that employees can rightfully consult an employment lawyer before signing the agreement.
Employers must also let their employees know about the non-disclosure agreement within a specific timeframe. For new employees, a copy of the agreement must be provided within 10 days of their start day or before the employer makes the job offer, whichever comes first. If an employee is already working with the company, then a copy of the agreement must be provided 10 days before it will go into effect.
That aside, non-compete agreements are enforceable if they meet the following requirements clarified under the Massachusetts statutory law:
- Reasonableness: The reasonableness of an agreement is evaluated based on individual party circumstances and public interest. It should explicitly state the length of the non-compete period (in most cases, no more than a year) as well as any limitations the agreement may have based on geographic area or service type.
- Legitimate business interest: Non-compete agreements in Boston are only enforceable if they protect legitimate business interests like trade secrets, business plans, and client lists.
Businesses in Massachusetts that choose to include a non-compete clause as part of an employment agreement must also offer garden leave or an equivalent program. Garden leave is when an employer pays an employee at least 50% of their highest salary within the last two years. This is only for the duration of the non-compete period and is relieved if the employee breaches their contract.
Because of this stipulation, some employers may claim breach of contract to avoid having to pay a former employee any additional money during the non-compete period. If this sounds like your situation, then an employment attorney can help you get the compensation you deserve.
How Effective is a Non-Compete Agreement?
The employer’s right to protect their legitimate business interests should be equally balanced with the employee’s rights to seek meaningful employment opportunities after terminating their relationship. To determine if a non-compete agreement that you’ve been asked to sign is fair, seek legal advice from an attorney experienced in non-compete agreements within your state.
Your lawyer can tell you whether the non-compete agreement is legal, effective, or enforceable based on their understanding of Massachusetts law.
Consult with a Non-Compete Agreement Lawyer in Boston
Schedule a consultation with the lawyers at HKM Employment Attorneys to discuss the details of your case. Whether you’re facing the consequences of signing an unfair non-compete contract or you’re unsure if you should sign a new agreement, your attorney will act as your advocate to ensure you make the best decision for your interests.