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Non-compete agreement

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L4R3L2

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Posts: 70

Joined: Mon Oct 01, 2018 3:48 am

Post Tue Dec 04, 2018 5:07 am

Non-compete agreement

Medium sized town.
Isolated.
One good locksmith shop, and a couple sole-operated mobile outfits.

What is to prevent the shop in this scenario from hiring locksmith candidates with prior experience just to get their signature on a non-compete agreement, then letting them go, thereby denying the person from doing any locksmithing work in his own home town? Collecting signatures, so to speak.
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Robotnik

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Posts: 154

Joined: Sat Nov 29, 2014 8:01 pm

Location: Oregon

Post Tue Dec 04, 2018 7:36 am

Re: Non-compete agreement

Depends on laws in your state. A few - CA most notably - effectively treat noncompetes as unenforceable outside of a few specific situations, and quite a few have some restriction on how and when noncompetes can be enforced, such as to protect trade secrets or proprietary processes and practices.

In the specific case you suggest, it would seem pretty clear the shop in question is using noncompetes in bad faith, and I would think few courts would rule them enforceable. Broadly, the purpose of an agreement like this is to protect the company's trade secrets and practices, not to allow a company to stifle any and all competition. Courts haven't generally looked kindly on broad noncompetes that effectively prevent the former employee from ever working in the industry again.

(Not a lawyer, so take the above as a nonprofessional opinion)
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MartinHewitt

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Joined: Sat Nov 26, 2016 6:19 pm

Location: Germany

Post Tue Dec 04, 2018 3:04 pm

Re: Non-compete agreement

In Germany non-competes in employment contracts can be valid after employment if the company pays the former employee. Not sure if the amount is the lost business or if it is connected to the former salaries.
In case you wonder ... Martin Hewitt is a fictional detective in stories by Arthur Morrison:
Martin Hewitt, Investigator Chronicles of Martin Hewitt

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