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Noncompete agreement enforceability always a key issue

| Oct 5, 2020 | Employment Contracts |

Disputes in the Michigan and national business realm surrounding noncompete agreements occur frequently and often garner prominent judicial attention.

Indeed, a recent article on the subject matter stresses that, “The most litigated issue in employment contracts is the legality of so-called ‘restrictive covenant’ provisions, such as a noncompete clause.”

Why is that the case? And why – as we noted in a recent blog post at the established Bloomfield Hills legal offices of Sterling Employment Law – are courts “routinely subjecting noncompetes to closest scrutiny and, often, intense criticism?”

In a word, the tight focus on noncompetes comes down to notions concerning freedom, a point we duly noted in the above-cited July 23 blog entry.

We emphasized therein that a worker seeking to change employers and facing blowback from a former company will often legally challenge an existing noncompete on grounds of unreasonableness. That is, such contracts are often resisted for their allegedly unlawful curbs on worker mobility and the inherent right to pursue a livelihood.

Courts scrutinizing a noncompete will closely assess the reasonableness parameters and how they align with the given language of a given contract. For how long of a period does an ex-employer seek to limit a former worker’s ability to settle in with a business rival? Is a sought limitation intended to apply only locally or across the entire country? And what type of activity is sought to be curtailed (e.g., conduct limited to only certain matters or spanning every conceivable type of work an individual might do for a new employer)?

These can make for thorny questions. The bottom line that has emerged with force in recent years in courtrooms across the country stresses increasing judicial distaste for noncompetes that do not seem reasonably limited across all relevant dimensions.

An experienced and litigation-savvy employment law legal team can provide further information concerning noncompetes and their enforceability.

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