The Importance of A Non-Compete Agreement
With the steady rate of growth our economy has been enjoying, more and more businesses are opening and creating increased competition in the majority of American industries. One of the primary ways companies combat this newfound competition is to have their employees sign non-compete agreements. This practice holds particularly true for members of higher up management teams, but small businesses across the country are increasingly utilizing the various benefits that non-compete agreements provide.
Agreements in Florida
While the government is normally hesitant to regulate activities that promote trade, there are certain business covenants that the state of Florida typically approves. Among these covenants are non-compete agreements, non-disclosure agreements, and non-solicitation agreements. The primary purpose of these various agreements is to preclude current employees from engaging in competitive activity against their place of employment after they leave the company. In most cases, if these agreements maintain reasonable terms and conditions, they can be both beneficial to the original firm and the economy in general. What is important is to ensure that the agreements your employees sign are well written and prepared by a knowledgeable attorney. Failure to ensure your non-compete agreement is reasonable can invalidate the agreement, resulting in a large waste of time and money.
Why Do You Need A Non-Compete Agreement?
The following are some of the most common benefits enjoyed by business owners who have their employees sign a non-compete agreement as part of their employment contract:
- One of the fundamental advantages to having your employees sign a non-compete agreement is that your clients will have increased confidence in the protection of their sensitive information. The agreement will typically alleviate the fear of an employee improperly taking customer information.This heightened sense of security can be an invaluable asset to any business.
- Non-compete agreements can serve as a barrier that keeps your competitors from trying to entice your employees to sign on with their firm. In your non-compete agreement you can include a provision that prohibits your employees from working for a competitor for a certain period of time following their term of employment at your company.
- You can also ensure that your employees do not leave and take the clients they work with. It is common in certain businesses for a client to become particularly attached to the member of your team that they work with. This can create the fear that if the employee leaves they may take this client with them. However, you can prohibit this by having your employees sign a non-solicitation agreement that prohibits them from contacting your customers for a set period of time.
- Overall, restrictive covenants can add immense value to the overall valuation of your firm. Knowing that employees can not leave and take information or customers with them goes a long way toward enticing potential buyers of your firm should you choose to sell.
Hire An Attorney Today
The ultimate goal of any business is to make money and increase profits. With the help of an attorney, you will be able to draft restrictive covenants for your employees that not only protect your business but also foster future growth for your firm. A knowledgeable employment law attorney will have an in-depth understanding of Florida state law and its affect on your business. Dilla Employment Law, P.A. can work with you to develop an individualized plan to help protect your business and lay a foundation for future prosperity. Call 727-888-6203 to schedule a free consultation.