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Employment law: Should I bother with a noncompete agreement?

On Behalf of | Jun 12, 2018 | Employment Law |

Noncompete agreements are fairly standard in most Wisconsin businesses, but there are still holdouts. Some employers feel worried that potential employees will feel put off by signing a contract that contains a noncompete clause, while others do not fully understand the benefits. Under employment law, noncompete agreements are easy to use and quite effective at protecting important insider information of your business.

Sometimes referred to as noncompetition clauses, these agreements essentially prevent employees from moving on to your competitors after they are no longer involved with you. Although it might not strictly stop a former employee from working for a competitor, a noncompete agreement does restrict how the ex-employee can use information gained while in your employment. This means he or she cannot divulge do any of the following.

  • Divulge trade secrets
  • Misuse intellectual property
  • Take the same position with a different company
  • Engage in competitive behavior

However important it is to protect your business and its intellectual property, you must also respect the rights of your workers. Creating a restrictive noncompete agreement can make it difficult for a former worker to move on and find gainful employment elsewhere. If this is the case, a court may even rule that your agreement is too restrictive and therefore invalid, leaving you without the ability to protect any insider information of your business.

Protecting your business from competitors is essential, and noncompete agreements are an efficient tool for doing so. However, you must find balance between protecting your own trade secrets and the rights of your employees. For more information about noncompete agreements and other important Wisconsin employment law topics, be sure to visit our website.