Are non-compete's enforceable if you don;t sign anything?

I believe this might be a unique one for you. I have been working for a painting company as a business sales manager for four months. I have recently considered starting my own painting business. My employer has just sent me my employee agreement after all this time that has a non-compete clause in it, and has asked me to sign it.
The clause is a noncompete for 2 years in a 50 mile radius. If I would start this business I think it would violate the terms of the agreement.
My question then is, if I don't sign this agreement, and quit the company to start my own business, would they then have legal recourse to collect damages, considering I have worked with them for these 4 months under an employee agreement I was supposed to sign in the beginning but didn't because of an oversight on their part?
Thanks for your time.

Sincerely,
Mike

1 answer  |  asked Jul 14, 2005 5:33 PM [EST]  |  applies to Colorado

Answers (1)

Nina Kazazian
Enforceability of unsigned agreement

In order for a non-compete to be enforceable, it should be signed. In some instances, an employer (or employee) could argue that the written agreement is enforceable even though it is not signed, but they would have to prove that there was an oral agreement, and the writing memorialized the terms of that agreement.

In Colorado, however, a non-compete that is in writing but not signed would be very difficult to enforce. Also, even if the non-compete were valid, the duration (2 years) probably isn't enforceable. The court would probably modify that part to 6 months to a year.

If the employer wants you to sign the non-compete at this point, it would not be enforceable without "consideration"--meaning that the employer would have to give you something extra (a raise, bonus, etc) in exchange for your assent.

The employer may, however, terminate your employment if you refuse to sign, since absent an agreement which specifies the duration of employment, employment is "at-will" (meaning it can be terminated by either party at any time, except for unlawful reasons, with or without notice or cause).

You should consult with an attorney about the details of your situation (was the non-compete described to you when you started your employment? Is the written provision the same as what was discussed before you started?) Please feel free to call me to set up a consultation meeting.

Thanks.
Nina Kazazian

posted by Nina Kazazian  |  Jul 15, 2005 12:53 AM [EST]

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