Intellectual property is often a business’s most valuable asset. Depending on the circumstances, companies may want to implement noncompete clauses in their employment agreements to protect intellectual property and other confidential information.
Defining noncompete clauses
Noncompete clauses are a contractual agreement between employers and employees where workers agree not to engage in a similar job for an organization’s competitors. This can allow companies to protect their important secrets from their largest business adversaries. They can also be beneficial to those who purchased a business, as these contracts can help new owners turn a profit without having to worry about the old owner creating competition down the street.
Benefits of noncompete agreements
Such agreements can bring value to businesses in the following ways:
- Confidential information can be protected for a specified period.
- Businesses are often less likely to lose valuable customers when employees leave.
- Former high-performing employees may be less likely to use their skills elsewhere.
- Other employees may not leave as quickly as a violation of noncompete agreements can feature payback clauses, which could require the employee to reimburse the employer for training costs.
Companies deserve proper protection
There are many factors to consider when implementing noncompete agreements. But owners who want to protect their most valuable trade secrets and intellectual property may want to consider doing so. If you are a business owner and have concerns regarding noncompete enforcement, an experienced business law attorney can help answer your questions.