What’s the quid pro quo on noncompete agreements?

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in Employment Law,Human Resources

Q. We want current employees to sign noncompete agreements. If we do not offer an employee something of value in exchange for signing the agreement, is it against the law to terminate the employee? If we offer something of value, and the employee refuses to sign, can we terminate the employee?

A. If the employee does not already have an employment agreement, then the employee is employed at-will and can be terminated at any time and for any reason, except illegal reasons. Thus, if you are requiring employees to sign noncompete agreements and one refuses to do so, you can terminate the employee.

You should ask current employees to sign a noncompete agreement only if you offer some consideration; otherwise the noncompete agreement is not enforceable. Also, keep in mind that a noncompete agreement must be part of an employment agreement.

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