Non-Compete

Non-Compete

As a company owner, you want to be able to trust your employees. However, if you dedicate resources to train an employee, build their skills, and teach them the ins and outs of your business, it can be frustrating and costly when that employee takes their new knowledge to a competitor to help them benefit over your business. Unfortunately, this happens all the time, so many business owners might choose to have employees sign non-compete agreements.

It might seem straightforward that an employee signs a non-compete agreement, and then they cannot go work for a competitor. However, non-compete law is much more complex than that. Each state has its own approach to non-compete law, and Michigan is no different. Whether you would like to draft an agreement for your employees to sign or need help enforcing a non-compete, you should seek help from an experienced non-compete attorney in Birmingham who can skillfully apply Michigan’s non-compete laws to best protect your business.

Enforceable Non-Compete Agreements

The main challenge with non-competes is that courts will not always enforce these agreements, and when this happens, it gives your company little legal recourse for competing employees. It is important to have a skilled lawyer draft your non-compete to ensure that yours will stand up in court if you need to enforce it down the road.

In order for non-compete agreements to be enforceable in Michigan, the court will review the following factors:

  • Whether the duration of the contract is reasonable
  • The restrictions are limited to a particular geographical area
  • The restrictions only apply to specific types of work

A quality non-compete agreement should properly balance your company’s interests with the ability of the former employees to choose their employment and work in their selected field. If your contract is deemed unreasonable or overly-restrictive, the court could throw the agreement out, leaving the employee free to take their training and benefits to the nearest competitor right away. Always seek help when it comes to drafting non-compete agreements for your employees.

Protecting Your Business Interests

Your non-compete should also make it clear how the agreement serves to protect specific business interests. Simply not wanting employees to find similar employment elsewhere is not enough of a reason to restrict their employment. Instead, your agreement should specify which interests you aim to protect, including:

  • Proprietary information
  • Trade secrets
  • Clients and customer relationships
  • Specialized training and processes
  • Goodwill

Enforcing an Agreement

If a former employee violates a non-compete, goes to work for a close competitor, and gives that company an advantage, you can file a complaint against the employee for breaching the contract. It is important to have a non-compete litigation lawyer handling this process to ensure your agreement and your company’s rights are upheld whenever possible, give us a call today for more information.

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