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What to Include in a Non-Compete Agreement

On Behalf of | Jul 25, 2019 | Business Law, Contract Law

A non-compete agreement aids businesses in protecting sensitive information. A well written non-compete agreement can protect a business’ interests in many scenarios. This information can range between a wide variety of business aspects which include strategies, financial info, specialized training, clientele you name it. These types of agreements are important for any business that employs people who are subject to sensitive information. We’ve discussed the most recent changes to Nevada non-compete agreements in a previous blog (Is Your Nevada Non-Compete Agreement Still Valid?) and today we’ll go into more detail as to what you would want in a non-compete agreement as a business owner.

When it comes to protecting proprietary information in a non-compete agreement, you must first be able to clearly identify what it is you would like to protect. Your agreement should state specific business interest/s that an employee has access to. A confidentiality agreement should also be signed in this instance. In an event of a possible breach, a company will need to identify what proprietary information may be in jeopardy of falling into the wrong hands.

Make sure to clearly classify the parties involved in the non-compete agreement. This step seems pretty obvious but there may be scenarios that are easily overlooked here. Consider consulting with a Nevada business attorney before presenting your non-compete agreements to future employees.

A business should also specify the parameters of the non-compete agreement but must practice care since it will need to be within reason. Extreme restrictions may make your non-compete agreement null in the eyes of a court and thus leaving your business interest at risk. When setting parameters, time and distance are the two most common limitations that a judge may decide to be unreasonable. Yes, you will want to protect your business but being heavy-handed in your non-compete conditions may work against you.

There are many other aspects you’ll want to include depending on your business situation and industry. A carefully tailored non-compete agreement can give any business owner assurance when it comes to his/her business interest. It would be devastating to see your business damaged due to a poorly written non-compete. It’s good practice to scrutinize and have these contracts reviewed by a contract attorney as your business grows and changes.

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