The courts will consider how long this limited confederation is and whether the circumstances are reasonable. Many self-designed non-competition prohibitions attempt to set unreasonable durations. For example, if you sew and your agreement states that the person concerned cannot operate a competing business (at a reasonable distance, as explained below) for one year, they will stop rather than indicate that the same person cannot operate a competing business for 3 years or more. The reason is that in this industry, people use a tailor that does a good job and that is usually hard to leave as Schneider was found once. It is reasonable to expect a person looking for a new tailor to find one within a year to feel comfortable. The ban on the person limited for more than 2 years is too long given the nature of the industry. States generally consider four different factors in determining whether your non-competition agreement is valid. You ask: 1) Is it time-limited?; 2) Is it limited in geographic scope? 3) Is it limited to a specific sector or activity? and 4) Does it protect a legitimate business interest? In general, non-competition obligations must be closely tailored to the needs of the coercive party and should not be overly restrictive in order to inflict unreasonable difficulties on the other party. It is important that you issue a non-compete clause that is upheld in court; Otherwise, you have wasted paper and may have been born another local competitor in your market. The non-competition clause must be limited to its scope. A clear example is the geographical scope of the restriction. An appropriate restriction may prohibit an employee from showing up within 5 or 10 miles, depending on the size and population density. An inappropriate (and therefore unenforceable) clause could prevent the employee from competing in the state as a whole.
These include the impact of the non-competition agreement on the livelihoods of the person or business with reduced mobility. If a person is a seamstress and has been a tailor throughout his or her life, a non-compete clause, which generally limits that person`s ability to perform tailoring work, is probably invalidated, whereas if the same agreement limited the limitation to thieves alone, for example. B if the person is a tailor, the court will probably find that this scope is so limited that it is valid because it does not limit the tailor.