What is the non-compete agreement law in Virginia?
Virginia Law on Non-Compete Agreements If you work in the Commonwealth of Virginia and have signed a contract with your employer containing a non-compete clause, you may face legal consequences if you violate that agreement. You should know how this can affect you in the event that you are terminated or decide to switch jobs.
Can a non-compete agreement protect your business?
While Non-Competes can be immensely valuable, they are not a cure-all. It is a mistake to think that such an agreement is the only thing that is required to retain valuable employees or protect your business’ confidential information. Employees can always choose to defy a Non-Compete and risk the legal consequences.
Why do courts refuse to enforce non-compete agreements?
One of the most common reasons that courts refuse to enforce Non-Competes is that employers make the mistake of obtaining the agreement from an already-hired employee without providing the employee with anything of value in return. Generally, such agreements are unenforceable because the employee did not receive any additional “consideration.”
Can a seller of a business transfer a non-competes?
Basically, some jurisdictions do not permit the seller of a business’ assets to transfer its Non-Competes to the purchaser unless the employee consents to the assignment. This means that the purchaser of a business’ assets may not be able to enforce its Non-Competes without the employee’s consent.
What is the normal duration of a non compete agreement?
While non-competition agreements entered into in an employment context generally need to be limited in length to a period of six months to three years, in connection with the sale of a business, North Carolina courts have been willing to enforce longer non-competition periods, such as five years.
What you should know about non compete agreements?
- Previous competitive experience.
What are the elements of a non-compete agreement?
- Duration. The duration of a non-compete agreement typically ranges from six months to two years (or less).
- Scope. The employer must indicate the specific work or activities that they are restricting the employee from doing.
Do you really need a non-compete agreement?
When trade secrets really are a concern, using non-compete agreements may be valuable. Think partners, executives and other key personnel who can take customers and resources with them. However, for lower-level associates who don’t have trade secrets, non-compete agreements may not be worth the trouble.
How does the new law affect Noncompete agreements?
Accordingly, the law has the potential to affect noncompete provisions contained in employment agreements, standalone restrictive covenants, and separation agreements presented at the end of employment. What is less clear is the extent to which the new law might also impose restrictions on customer nonsolicitation provisions.
How can an employer recover from a non-compete agreement?
An employer cannot recover for an employee’s violation of a non-compete clause without establishing proof of harm. Actual (monetary) damage can be shown by referring to instances of “successful competition” – competition from a former employee that results in injury.
What makes a noncompete agreement a nondisclosure agreement?
The new law allows for the continued use of nondisclosure agreements if they are designed to “prohibit the taking, misappropriating, threatening to misappropriate, or sharing of certain information, including trade secrets” and confidential or proprietary information. Who qualifies as a “low-wage employee?”
Are non-compete laws enforceable in Virginia?
Non-Competes in Virginia are enforceable, as long as they are very narrowly written – in other words, they must not be broader than necessary to protect a legitimate business interest for the employer.