Non-Competes (Employment Agreements)

By: Cody

Many of us seniors who are graduating next week are eager to find a job, including me. Most of us are so eager that we will take the first job that lands in our lap, without any real consideration. For an entry level job this usually is just fine. However, some jobs may require more consideration before accepting them.

A good example of this is when a job has a “non-compete.” A non-compete is an agreement between an employer and an employee. The agreement stops an employee from going to work with the employer’s customers, potential customers and competitors. This helps the employer protect their proprietary information and knowledge from being given to other companies. The non-compete has a specified time period. This time period is generally one year after the date that the employee leaves the company.


If an employee breaks a non-compete agreement, both the employee and their new employer can be sued for breach of contract. This can end up costing thousands to tens of thousands of dollars, so it is definitely something that you want to pay attention to. An employer can also threaten to stop working with your new employer until they fire you. So non-competes are serious business.

Some companies have buyout options for non-competes. This would require you to pay your employer a certain sum of money in order to “buy” your way out of the contract. However, these buyouts are often too expensive to afford or simply aren’t offered by the employer.

Most of you may not feel like an entry level position would require a non-compete. While it is true that most do not, I just so happened to interview with a job last week that would require a non-compete. I am taking this non-compete into great consideration before I make a decision about whether to work there or not (assuming I am offered the job, fingers crossed!). This company has a large market share of my career field. So if I do work for them, I would not be able to work with 60% of the companies in my field, if I decided to change jobs. So I have definitely been taking this into consideration while thinking about making my decision about the company.

This post is meant to get you to ask questions during your interviews to see if the prospective employer requires a non-compete. You can do this by asking if they have non-compete agreements, or employment agreements as they are sometimes called. If they do, make sure to get a copy of it before you accept the job and thoroughly read it and make an educated decision based off that. No one wants to be out of work for a year just because they didn’t review the non-compete before they signed it.

If you have any questions about non-competes stop by our office and talk to Mary. She may have the answer or can point you in the right direction to get your questions answered.

Read Cody’s other posts

Photo By: Filipo

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