Noncompete agreements are standard practice in many industries. Typically, they’re part of the onboarding process. Your job offer may be contingent on you signing a noncompete.
But what if you’ve already been hired, and your employer wants you to sign a new or modified noncompete agreement? Here are some considerations to be aware of.
1. The modifications must comply with state law to be enforceable
State law imposes restrictions on noncompetes. In Wisconsin, for example, they must be reasonable in scope, geographic area and duration. Your employer can’t enforce an overly broad agreement. Additionally, the restrictions must be reasonably necessary to protect your employer’s business.
The same holds true for modifications of an existing noncompete agreement. Provisions that go too far may be unenforceable – and they may render the entire agreement unenforceable.
2. You might be entitled to get something in return
When modifying your noncompete agreement “midstream” – that is, after you’ve already been employed – your employer might be required to give you some benefit in return. That benefit might be a salary bump, a promotion, more time off or a one-time bonus, for example.
However, in some states – including Wisconsin and Illinois – employers don’t need to give you anything in return. Your continued employment is considered enough to support a modification or new agreement.
3. Talk to an attorney before signing
Because a noncompete agreement can have a major impact on your career and livelihood, you shouldn’t sign away your rights without first consulting an attorney. This is true even for modifications of existing agreements. Although your employer may not be required by law to provide something in return, you may still have a strong bargaining position, and you don’t want to miss the opportunity to leverage any advantages you may have.