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Noncompete agreements must meet tough Georgia standards

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in Employment Law,Human Resources,Leaders & Managers,Management Training

Georgia courts generally don’t look kindly on overly broad noncompete agreements. If your organization uses noncompetes, make sure yours can meet the state’s tough standards.

Courts may declare a too-restrictive agreement void if it imposes an unreasonable restraint on trade.

Recent case: Angela Burgess went to work for Safety and Compliance Management, a drug-and-alcohol testing service. She signed a noncompete agreement prohibiting her from working “in any area of business conducted by Safety and Compliance Management” for two years and within a 50-mile radius of the office.

Burgess quit and went to work for a local medical center as a medical assistant. The center also provided drug-and-alcohol testing. Safety and Compliance Management sued.

But the Court of Appeals of Georgia said the com-pany’s noncompete restriction was too broad to be legal. A valid noncompete agreement must specify “with particularity the activities which the employee is prohibited from performing,” and not block an employee from doing just any type of work for a competitor.

The court wrote that a noncompete agreement must balance a former employee’s right to earn a livelihood with the employer’s right to protect itself from unfair appropriation of business information or trade secrets. Safety and Compliance Management’s agreement went too far. (Stultz, et al., v. Safety and Compliance Management, No. A07A0202, Court of Appeals of Georgia, Third Division, 2007)

Final tip: Always have an experienced attorney review noncompete agreements. He or she will be able to suggest language likely to survive a Georgia court’s strict scrutiny. 

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