Leesburg Non-Competition Agreements
Employers use non-competition agreements to prevent their employees from picking up and going to work for a competitor. Many employers reasonably fear that workers will use information they have gleaned at one place of employment to benefit another, so they include these non-compete agreements in their employment contracts.
However, the Commonwealth of Virginia generally disfavors any restraint on a person’s ability to work. For that reason, courts will closely scrutinize a non-competition agreement to determine whether they are valid.
At Simms Showers, we can help a business draft a non-competition agreement in a manner that comports with the law. We can also assist any worker hoping to renegotiate their agreement or get out of one altogether. Contact us today to find out more.
Enforceable Non-Competition Agreements
A non-competition agreement essentially states that an employee will not work for a competitor for a specific amount of time. However, these agreements can’t be too broad or last indefinitely. Instead, they are valid only to the extent an employer can show:
The work restriction is not greater than necessary to protect the employer’s legitimate business interests.
The agreement does not restrict the employee’s ability to find another job and support themselves too severely.
The agreement doesn’t violate a public policy of the Commonwealth.
In many cases, disputes revolve around whether the agreement is too restrictive. For example, a court will look at the duration of the non-competition agreement and the geographic limitations. Both must be reasonable. A non-competition agreement which prohibits an employee from working anywhere in the Commonwealth for decades is an obviously illegal agreement, since a person would become destitute.
If you are an employer hoping to include agreements like these in employment contracts, contact us. A properly drafted non-competition agreement should hold up in court and possibly prevent any litigation in the first place.
Non-Competition Agreements & Low Wage Employees
Virginia law actually prohibits the use of these agreements with “low wage” employees. A worker is considered “low wage” if their average weekly paycheck is below the state average—roughly $65,000 as of 2022. The amount will fluctuate each year depending on the economic climate.
The law is very broad and also covers interns, students, and other unpaid workers. It even extends to contractors who are paid an hourly wage that is less than the state average.
If you are an employer who wants to protect customer lists and other trade secrets, contact us. Inserting an illegal non-competition clause in your contracts is counterproductive if they can’t be enforced.
Remedies for a Breach
When an employee breaches a non-compete clause, an employer may recover if they can show actual damage. This means showing that the former employee actually harmed a former employer financially. It is not enough that the former employee is simply working for a competitor. Economic losses must be established.
Speak with Simms Showers Today
Our lawyers understand all the different wrinkles involved with Virginia non-competition clauses. We can draft a solid clause that a judge will uphold, or we can help you litigate a dispute involving one. To learn more, please contact a Leesburg business attorney today.