Maryland employers will generally take whatever steps they can to protect their business. In many cases, employers may be considering whether they should have employees sign an employment contract, such as a noncompete agreement. These agreements can limit the employment opportunities workers have should they leave the company.
Historically, the companies that generally utilized noncompete agreements were those in the technology or creative industries with highly sensitive or unique products or services. In order to avoid the possibility of an employee leaving a company to work for a competitor and taking client lists, trade secrets, and other critical data with them, many businesses had workers sign an agreement that banned them from working for certain companies for a specified time period.
But is the use of noncompete agreements getting out of hand?
In recent years, more and more companies are trying to protect themselves by having employees sign noncompete documents. No more is the practice limited to companies with extremely sensitive information; in fact, businesses including summer camps, hair salons, landscaping companies, and marketing firms, have utilized noncompete agreements.
However, critics argue that these employment contracts could be stunting a company’s growth and the competition within an industry. Companies are placing more and more restrictions on employees and spending more time and money enforcing these terms and policing former workers.
It can be crucial for business owners to weigh the pros and cons of these agreements. On one hand, noncompete agreements can provide employers and employees with some peace of mind in knowing what must be protected. However, if that agreement is unattractive to potential employees or it would cost a company more to enforce than is appropriate, it may not be an effective solution.
Business owners in Maryland would be wise to discuss their options with an employment attorney who is familiar with these types of agreements. If it is determined that an agreement would be effective, making sure that it is comprehensive and enforceable can be an easy way to avoid certain conflicts down the road.
Source: New York Times, “Noncompete Clauses Increasingly Pop Up in Array of Jobs,” Steven Greenhouse