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Be aware of the impact of signing a non-competitive agreement

On Behalf of | Oct 3, 2016 | Employment Law

For readers who are new to the state or who are beginning a job search Florida, the concept of the non-compete agreement may be a foreign one. When job applicants do not have the luxury of fielding several job offers, what is of primary importance may be obtaining a job capable of paying the bills. In many cases, it isn’t until an individual seeks to expand her employment opportunities that she realizes the restrictions associated with the employment contract signed.

While employers argue that non-compete agreements ensure loyalty of their employees, venture capitalists and entrepreneurs declare the contracts to be harmful to others beyond those immediately employed by the corporations that make signing the contract a prerequisite to obtaining employment.

Those negatively impacted:

1. Employees

It’s obvious that those immediately impacted by non-compete clauses are those who are not given free reign over their own employment future. Should an employee embrace job training, learn marketable skills and realize her potential at one job, she would be actively discouraged from seeking new opportunities with another employer. While today’s economic outlook is improving in the United States, it is still rare for an employee to work at one company throughout the course of her career. Actually, those with the flexibility to seeking new job options and the ability to move to new regions are those who strengthen the economy. Restricting movement of employees limits options for growth.

2. Innovation

On a larger scale, non-competitive contracts stifle innovation. The advancements spurred by former employees of one California company highlight the benefits of fluidity of employment. Hailing from Apple’s Cupertino headquarters, those exiting left to establish Electronic Arts, LinkedIn, Nest and Android, among other ground-breaking companies. Had Apple demanded its employees sign non-compete agreements, the developments in gaming, networking, home monitoring and computer operating systems would have been severely restricted. It is true that competition between companies increases without non-compete agreements; however, the competition forces businesses to become more nimble and more responsive to the needs of customers.

3. Region

Regions do benefit from the largesse that area corporations can provide. When such large corporations begin to put restrictions on employment, however, such long-term benefits recede. Those interested in starting up a new business will gravitate toward areas with a large pool of available talent, which exists in California. Those who have sponsored bills to reduce the impact of non-competitive agreements believe that easing contractual restrictions will unleash a flood of talent, enriching employees and employers alike.

The restrictions tied to a non-compete agreement may not seem evident when you first contemplate accepting a job offer that requires such a contract. This is why it is suggested that those confused about obligations connected to job offers discuss matters with a knowledgeable employment attorney.