1.Non-compete contracts are given to protect the company from its former employees working on competitors or revealing company trade secrets.



2.It is also called non-compete agreement, non-competition agreement, non-comp or covenant not to compete. Employees sign it when they got hired, during employment, when they decide to leave or all of the above.

3.It is also given to valuable employees to whom the company have spent money for training or to those who have access to important informations that losing him would accumulate loss for the business.

4.If employees sign it, they agree not to engage in the same industry for a certain period of time after leaving the company. If they opt not to sign it, they're likely out of a job, benefit or even had been subjected to lawsuit depending on when they chose not to sign.

5.It should not cover too wide geographic area because the legal system also puts high regard on a person's right to earn a living.

6.It must not prohibit the former employee in engaging in too many types of businesses. It can disallow, for a reasonable duration, joining key competitors but not other indirectly related industries.

7.Six months to two years duration is considered a reasonable time for the non-compete contract to last.

8.It is highly appreciated if appropriate benefits will be provided in exchange of signing a non-compete agreement. Promotion or a raise is also most welcome.

9.Non-compete contracts might not be enforceable if employees quit or were fired because they refused to engage in illegal activities while on the job.

10.It is also non-enforceable if the employer allowed other key employees to take employment on competitors. It will be unjust to permit the employer to rely on this contract which was fully ignored in the past.

While some of these information about Non-compete contract seems discouraging, it exists mainly to protect employers from unscrupulous employees. So as long as an employer or employee is reasonable, the law will definitely comes in favor with them.