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What your business needs to know about noncompete agreements

On Behalf of | Nov 19, 2021 | Business & Commercial Litigation |

In Georgia, employers are generally favored over employees in disputes about noncompete agreements unless the agreement violates certain legal criteria.

While employees sign these noncompete agreements during employment or as part of an offer of employment, they take effect once the employee no longer works for the employer.

What is a noncompete agreement?

A noncompete agreement is an agreement where an employee agrees not to begin a similar profession or trade in competition with the employer with whom they have the agreement within a certain geographic area for a certain amount of time.

What must a noncompete agreement include to be valid?

There must be consideration offered to the employee. Consideration is something of value, such as an employment offer or a raise. There must also be a business-related reason for the agreement, such as protecting trade secrets. The agreement must also be reasonable in the geographic area covered and the duration of time it lasts.

Are noncompete agreements enforceable in Georgia?

Noncompete agreements are enforceable in Georgia, but employees can raise a dispute over a noncompete agreement that does not meet the legal criteria to be valid.

The reasonableness of scope and duration are the factors most often contested in disputes. The duration of the agreement must not extend beyond the length of time the protected information is valuable. The geographic area covered must not be so great that it prevents the employee from obtaining employment, no matter how far they move. The scope and duration must be reasonable in regards to the business, location and protected information.