Want to know the limits of companies I can accept offers with given a non-compete clause.

I was never given a copy, but got one from a laid off employee. The non-compete says for 18 months I can't become an employee of any business in competition with or similar to my company (software developer) anywhere in the US where my company makes 5% of their gross revenues. It says that I will derive significan value from the company (confidential info), which I don't believe I have any knowledge of conf info. It says that I agree this is reasonable, etc... I was not told about the agreement or shown it until I went in to sign the employment papers & accept the offer. I feel as if I was under alot of pressure (given the CEO & CFO were almost constantly in the room with me trying to hurry along the process of signing all the many forms that day). I was not given anything for accepting other than employment. By the way this is worded, I don't think I can accept any employment anywhere near my home at all as a programmer. I have also not received any training and have only been employed for approx. 5 months. I do not feel I can approach my employer reasonably given the last time he was upset with someone, he threw something across the room in a meeting & almost hit someone. This company is a very small government contractor (approx. 20 employees). I'll post the text of the agreement below... They're main technologies include: Business Objects, Teradata, Informatica, Cognos. So, would it be reasonable to say that if I avoid government contracting companies utilizing these technologies that would be enough. Or even further, just avoid government contractors trying to higher me for any project that touches the same application or databases? I would think that would cover my companies right to prevent me from hurting their businesss.

Covenant Not to Compete.
(a) I agree that during the course of my employment and for a period of eighteen
(18) months immediately following the termination of my relationship with the
Company for any reason, whether with or without good cause or for any or no
cause, at the option either of the Company or myself, with or without notice, I will
not, without the prior written consent of the Company, (i) serve as a partner,
employee, consultant, officer, director, manager, agent, associate, investor, or
otherwise for, (ii) directly or indirectly, own, purchase, organize or take
preparatory steps for the organization of, or (iii) build, design, finance, acquire,
lease, operate, manage, invest in, work or consult for or otherwise affiliate myself
with, any business in competition with or otherwise similar to the Company's
business. The foregoing covenant shall cover my activities in every part of the
Territory in which I may conduct business during the term of such covenant as
set forth above. "Territory" shall mean (i) all counties in the State of Ohio, (ii) all
other states of the United States of America and (iii) all other countries of the
world; provided that, with respect to clauses (ii) and (iii), the Company derives at
least five percent (5%) of its gross revenues from such geographic area prior to
the date of the termination of my relationship with the Company.

(b) I acknowledge that Iwill derive significant value from the Company's
agreement in Section 2(a)(i) to provide me with that Confidential Information of
the Company to enable me to optimize the performance of my duties to the
Company. Ifurther acknowledge that my fulfillment of the obligations contained
in this Agreement, including, but not limited to, my obligation neither to disclose
nor to use the Company's Confidential Information other than for the Company's
exclusive benefit and my obligation not to compete contained in subsection (a)
above, is necessary to protect the Company's Confidential Information and,
consequently, to preserve the value and goodwill of the Company. I further
acknowledge the time, geographic and scope limitations of my obligations under
subsection (a) above are reasonable, especially in light of the Company's desire
to protect its Confidential Information, and that I will not be precluded from gainful
employment if I am obligated not to compete with the Company during the period
and within the Territory as described above.

(c) The covenants contained in subsection (a) above shall be construed as a
series of separate covenants, one for each city, county and state of any
geographic area in the Territory. Except for geographic coverage, each such
separate covenant shall be deemed identical in terms to the covenant contained
in subsection (a) above. If, in any judicial proceeding, a court refuses to enforce
any of such separate covenants (or any part thereof), then such unenforceable
covenant (or such part) shall be eliminated from this Agreement to the extent
necessary to permit the remaining separate covenants (or portions thereof) to be
enforced. In the event the provisions of subsection (a) above are deemed to
exceed the time, geographic or scope limitations permitted by applicable law,
then such provisions shall be reformed to the maximum time, geographic or
scope limitations, as the case may be, then permitted by such law.

1 answer  |  asked Aug 22, 2009 11:29 AM [EST]  |  applies to Ohio

Answers (1)

Bruce Elfvin
The general rule in Ohio is that non-competes are legal, but subject to several limitations. The Courts can and often do re-write the non-competes to eliminate offensive provisions. The primary consideration is whether the non-compete protects the legitimate interests of the employer or merely seeks to limit normal marketplace competition.

The provision in the employer's agreement is probably subject to changes, but getting the employer to walk away from it is preferable. It is overreaching and both its temporal and geographic scope is breader than normally protected.

You need to see an employment attorney and can select on near you at www.oelasmart.net

Regards, Bruce Elfvin

posted by Bruce Elfvin  |  Aug 31, 2009 08:03 AM [EST]

Answer This Question

Sign In to Answer this Question

Related Questions with Answers

Have an Employment Law question?