Corporate Law Blog

What factors bear upon the enforceability of noncompete agreements? P.2

In our last post, we began speaking about some of the factors that are taken into consideration when determining the enforceability of non-compete agreements. We've already mentioned that the fundamental consideration is whether the agreement is reasonable and that there are a handful of factors judges look at when determining the reasonableness of a non-compete agreement.

In addition to the factors we've already mentioned, judges also take into consideration the likelihood that the former employee could benefit another business with the knowledge and skills obtained from their former employment, the relative breadth or narrowness of the agreement, the extent to which the agreement limits the former employee's ability to find work after leaving, and the extent to which the agreement would prevent the public from having access to beneficial or necessary goods and services.

All of the above factors can impact a judge's decision to uphold a non-compete agreement. Although these factors are well-established in Kentucky law, it is difficult to say with certainty whether any given agreement will ultimately be upheld. As we commented last time, the best companies can do is to be aware of the law and do their best to craft agreements that protect their own interests while allowing reasonable freedom for employees and prospective employees who choose to leave the company with valuable knowledge and skills learning on the job.

Having the assistance of an experienced attorney in drafting, negotiating and executing non-compete agreements is an important way for businesses to protect their interests and ensure their non-compete agreements are effective. This is true not only of non-compete agreements, but of all employment contracts.