Non-Compete & Severance Agreements
It is becoming more common for employers to ask their employees (even those who are not in management positions or do not have specialized knowledge) to sign severance and non-compete agreements. If you are asked to sign such agreements, it is important for you to know your rights and understand what signing those documents might mean for your future. Working with the employment attorneys at Robert A. Klingler Co., L.P.A. prior to agreeing to the terms provided in those documents can prove to be invaluable to you because a skilled attorney will be able to identify any terms and/or conditions that may be unreasonable, unenforceable or might create some level of legal liability for you at a later date.
What Is a Non-Compete Agreement and What Does it Mean for You?
Simply stated, employees who sign non-compete agreements are essentially promising not to work for direct competitors of the employer for certain periods of time once they leave the employer. The agreement typically lays out the binding conditions and terms governing the employee’s ability to work within the same industry once he or she has been separated from employment. Non-competes might also limit a former employee’s ability to work in a particular area of the country and/or his or her ability to use any sales leads that were obtained while employed with the former employer.
Top Questions about Non-Compete Agreements
What is an Ohio non-compete agreement?
Non-competes are used in a variety of industries, but they are most common in sales and service professions. Regardless of the industry in which you work, if you signed a non-compete, it may be enforceable in Ohio.
Are non-compete agreements enforceable in Ohio?
It depends on the circumstances. Reasonable non-compete agreements can be enforceable in Ohio. The courts can apply several factors when determining if a non-compete agreement is enforceable. The court may also modify a non-compete agreement to impose different terms it considers fair and just for both parties.
What can happen if I violate my non-compete agreement?
A valid non-compete agreement is a binding contract between you and your employer. If you violate your non-compete agreement, your employer can sue you just as they would sue anyone who breached a contract.
If your employer is requiring you to sign a non-compete agreement on its own or in conjunction with a severance package, you are encouraged to seek legal guidance from one of the Cincinnati employment lawyers at Robert A. Klingler Co., L.P.A. as soon as possible prior to signing. Quite often, individuals who are faced with signing such agreements have concerns about their ability in the future to obtain work within the same industry. However, some employees are required to sign non-compete agreements even before they start work with the employer. Some employees will sign the agreements simply because they need the job. But it is crucial for employees to consider all the implications of the agreement ahead of time.
Some employees who separate from employers might also be asked to sign severance agreements, along with non-compete agreements, prior to them leaving. Generally, severance agreements entitle employees to receive severance compensation and certain benefits, depending on the terms. Severance pay is usually based on the amount of time an individual has been employed with the employer, as well as the individual’s salary or wages. What many employees do not realize is that employers are under no obligation to offer a severance package, unless the employer has obligated itself via a contract.
Severance agreements often contain a number of compromises that will essentially call for the soon-to-be former employee to give up any claims that may exist in exchange for the benefits noted within the agreement. However, it is never a good idea to sign such an agreement without having the benefit of legal advice prior to signing.
Non-compete and severance agreements need to be legally sound and fair, and a skilled attorney can take the time to review the terms of those agreements to ensure that they are not unduly burdensome on the employee. If your employer expects you to sign a non-compete or severance agreement, contact the attorneys at Robert A. Klingler Co., L.P.A. first to discuss your rights under the law.