Non-competition or non-compete clauses and agreements are some of the most common types of employment contracts. A non-compete agreement is a contract between an employee and an employer that prohibits an employee from working for a competing company or engaging in a competing business for a certain amount of time after an employee leaves a company. This usually holds true whether the employee was terminated or voluntarily quit.
In Ohio, reasonable non-compete agreements are enforceable in court, which is why it is so important that employees understand what they are signing. Enlisting the help of an Ohio employment attorney can help ensure an employee’s rights are protected.
Generally, Ohio courts will uphold and enforce non-compete agreements that are determined to be reasonable. The term “reasonable” is fact-specific and depends on many factors such as the duration of the agreement, the geographic area involved, and other circumstances. The courts will typically uphold a non-compete agreement if its restrictions:
To determine if the restrictions within a contract are reasonable, the courts take a few factors into consideration. These include:
Even if a court finds that one term in a non-compete agreement is unreasonable; it does not necessarily mean that the entire contract will be unenforceable.
It is also important that employees in Ohio understand that state law may also prevent certain forms of competition. For example, the Ohio Uniform Trade Secrets Act prevents employees from using an employer’s trade secrets in an inappropriate manner. Trade secrets are considered to be any information about the business, its processes, techniques, customer lists, or financial information that is of value to the company and that the business needs to keep confidential.
Employees must comply with this legislation, regardless of whether or not they had a non-compete agreement. As such, it is important that employees are familiar with it, particularly if they wish to stay in the same line of work after leaving their former employer.
Leaving one business to work in a similar business can become be complex in Ohio. If you want to start a business or seek employment with a company that could be construed as competing with your former company, contact our Columbus employment lawyers today. At Marshall Forman & Schlein LLC, we can explain how non-competition agreements work and the legal problems that may occur if the agreement is violated. Call us today or contact us online to schedule a meeting with one of our attorneys.
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