Ohio businesses spend a great deal of time and effort generating business and creating goodwill with their customers. Likewise, employees of such businesses are the ones who make this possible. Depending upon the type of business and customer relationships, the business may ask employees to sign a noncompetition agreement. This type of agreement is often at the center of employment contract disputes when the employer/employee relationship comes to an end.
The noncompetition agreement is often used to prevent a former employee from competing with a business. From the perspective of the business, it is responsible for developing the product and the customer relationships. Additionally, it is likely that the former employee had access to confidential information regarding the business and its customers, which he or she could use as an advantage. At the heart of the matter is who should reap the benefit of such effort and knowledge.
On the other hand, the former employee still needs to be able to earn a living. In determining whether a noncompetition agreement is valid, the courts often require that there be some form of compensation for signing it. This competition is often in the form of the job offered. Additionally, the courts generally require that it cover only legitimate business interests of the employer and be of a reasonable time and locale.
Employment contract disputes can create ill will for all involved. Additionally, they can be a costly endeavor for the Ohio business. Whenever possible, these types of disputes are best avoided. However, when this is not possible, experienced legal counsel can be invaluable in resolving the situation.
Source: employment.findlaw.com, “Non-Competition Agreements: Overview“, Accessed on Nov. 21, 2017