The point of a non-competition agreement often referred to as a “non-compete,” is to keep an employee from quitting his or her job at one employer to take up a more lucrative offer from a competitor. Companies invest thousands of dollars into the education and training of their employees, and in order to safeguard their investment value into personnel, they require employees to sign non-compete agreements that bar the employee from seeking employment with a competitor for an extended period of time.
A Non-Compete Agreement is Meant to Protect an Employer’s Investment in the Employee
Employers are more concerned now than ever with the secrecy of their information. Every day, millions of dollars are at stake in all types of fields when one company gets a small advantage over the next. In order to protect their intellectual property, companies use trade secrets, which act like patents, where the information itself is the invention. An employee may have no intention of disclosing important information about the former employer or trade secrets, and still, the former employer could potentially lose untold sums of money if that employee goes to work for the competition. This is because the value of the employee’s knowledge and training might be just as important as a trade secret.
Is Your Non-Compete Agreement Legal or Does It Overstep the Law?
A recent study found that 18% of the U.S. workforce is limited by non-compete agreements. Moreover, 15% of low wage positions require non-compete agreements, and these are positions that do not require college degrees, such as sandwich makers, bartenders, and manicurists, as reported by National Public Radio. Why are companies forcing potential employees to sign non-compete agreements in order to be hired for such types of work? In many of these cases, the employer’s non-compete clause has overreached its legal bounds of protecting the employer and instead is mainly just harming the employee. After all, how much training has an employer really put into training a minimum wage employee to make a sandwich? Non-compete agreements also unfairly constrain highly trained employees with advanced degrees. For instance, a non-compete agreement that forces a software engineer to stay out of his or her field of work for five years would most likely completely be defeated in litigation due to its unfair restraint on the employee.
Call a Kansas City Employment Attorney Today
Strict non-compete agreements are good for employers but bad for workers and wage growth. There is evidence showing that strict state non-compete laws hurt job mobility as well as wage growth, as reported by The Office of Economic Policy U.S. Department of the Treasury. Some states, such as Hawaii and Oregon, have put strict limits on non-compete agreements, such as limiting them to 18 months or making them void for healthcare workers or tech workers. Missouri introduced a similar bill recently, but that bill failed to become law. The Kansas City attorneys of HKM Employment Attorneys have more than 40 years of combined experience handling all types of employment law, including assessing and defeating unfair non-compete agreements. Call today for assistance.