How Enforceable Are Non-Compete Agreements?

We are frequently asked whether non-compete agreements are enforceable.  Employers favor non-compete agreements because they fear they will hire somebody only to have that individual take his/her training, the employer’s customer list and industry knowledge, and use it to compete against the employer.  On the other hand, employees typically disfavor non-compete provisions because they feel as though it restricts their ability to earn a living, if they were to ever leave that job.  At the end of the day, the Court is the one that ultimately decides whether these restrictive covenants are enforceable.  While Courts do not favor non-compete agreements, they are enforceable under Arizona law so long as they are:

1) reasonable as to geographic scope,

2) reasonable as to duration of time, and

3) narrowly defined to limit activities that you performed for the employer.

Thus, an agreement that limits an employee from working for a competitor for a period of 10 years throughout all of Arizona would likely be unenforceable, while an agreement that only prohibited the same employee from working for any competitor for a period of 6 months and within a 10 mile radius of the employer’s location would likely be enforceable.  If you have any questions about your non-compete agreement with your employer, contact the attorneys at Fleming & Monroe on our Facebook page or at fmlawaz.com for a free consultation. #fmlawazlegaltips