A noncom petition agreement, also known as a non-compete agreement or covenant not to compete, is a legal contract used by small businesses in Missouri to protect their trade secrets, confidential information, and goodwill from being divulged or exploited by former employees or business partners. This agreement aims to restrict individuals associated with the business from engaging in activities that could harm the company's interests, such as starting a competing business or working for a competitor. In Missouri, there are two primary types of noncom petition agreements that small businesses commonly utilize: the employment noncom petition agreement and the business sale noncom petition agreement. 1. Employment Noncom petition Agreement: The employment noncom petition agreement is a contract signed between an employer and an employee, which imposes restrictions on the employee's ability to compete with the business during and after the employment relationship. This agreement typically outlines the duration, geographic scope, and nature of activities prohibited for the employee post-employment. It aims to safeguard the company's trade secrets, customer relationships, and other sensitive information from being used by the employee to gain an unfair advantage in the market. 2. Business Sale Noncom petition Agreement: The business sale noncom petition agreement is often executed when a small business owner sells their company to another individual or entity. This agreement ensures that the previous owner will not engage in activities that could undermine the value or success of the business being sold. It may include provisions restricting the former owner from starting a similar enterprise in a certain geographic area or soliciting the previous customers of the business. Both types of noncom petition agreements in Missouri must be carefully drafted to protect the legitimate business interests of the company while being reasonable in scope and duration. The enforceability of these agreements can vary depending on various factors, such as their reasonableness, geographic limitations, and the nature of the business involved. It is essential for small business owners in Missouri to consult with experienced legal professionals to ensure their noncom petition agreements comply with state laws and effectively safeguard their business interests. By having well-drafted and enforceable noncom petition agreements, small businesses can mitigate risks associated with unfair competition, protect their intellectual property, and maintain a competitive edge in the market.
Missouri Noncompetition Agreement - Small Business
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How to fill out Noncompetition Agreement - Small Business?
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FAQ
compete clause is not legally enforceable unless it is reasonable. Whether or not it is reasonable should, under current law, be decided by reference to the circumstances at the time it was entered into.
Non-compete agreements are typically considered enforceable if they: Have reasonable time restrictions (generally less than one year) Are limited to a certain geographic area (specific cities or counties, rather than entire states)
Under Missouri law, the purpose of enforcing a noncompete agreement is to protect an employer from unfair competition by a former employee without imposing an unreasonable restraint on the latter. Indeed, a noncompete in Missouri is only enforceable to the extent that it is reasonable and no more restrictive than is
Considerable precedent in Missouri supports the reasonableness of a non-compete lasting between one, and sometimes up to two years, which is otherwise drawn narrowly to protect the employer's legitimate interests.
Typically, the only way to fight a non-compete agreement is to go to court. If you are an employee (or former employee) who signed such an agreement, this means you must violate the agreement and wait to be sued. It may be that your former employer has never sued another employee to enforce the non-compete agreement.
You Can Void a Non-Compete by Proving Its Terms Go Too Far or Last Too Long. Whether a non-compete is unenforceable because it covers too large of a geographical area or it lasts too long can depend on many factors. Enforceability can depend on your industry, skills, location, etc.
Here are five ways to beat a non-compete agreement.Prove your employer is in breach of contract.Prove there is no legitimate interest to enforce the non-compete agreement.Prove the agreement is not for a reasonable amount of time.Prove that the confidential information you had access to isn't special.More items...
Missouri courts have long recognized that non-compete agreements are enforceable, but only to the extent they are reasonable as to geographic scope and duration, and are reasonably designed to protect the company's legitimate business interests.