We often get asked about the enforceability of non-compete clauses or agreements ("non-competes"). These questions come from a variety of sources: individuals leaving a position for greener-pastures; concerned business owners dealing with a messy separation; and former employees opening their own business. We often review generic clauses in employment agreements without clear analysis as to best practices or if it makes sense in the context of specific positions.
We encourage all clients to address any concerns before a potential breach. A preliminary conversation between an experienced attorney and an employee or employer is quick and affordable in comparison to actual litigation to enforce or prevent enforcement of the non-compete. This conversation also offers confidence when moving into a new job, or fairly enforcing the non-compete. As a result, we often see that most employers can easily work with an employee to confirm that the non-compete is not being violated with a new position, or to craft an agreeable protective plan.
In Washington, non-competes are enforceable, but courts often frown upon them. Courts will look at several actors and may rewrite or remove overly broad and unenforceable provisions (“blue pencil rule”). Employers and employees should avoid the uncertainty by having a carefully crafted non-compete provision.
The best non-competes are clear agreements that fit the actual needs of the employer in regards to the specific employee without being overly prohibitive. This may include a focus on things such as solicitation of clients or improper use of proprietary information. It may also be narrowly tailored to provide only the protective time or geography that is actually necessary. Finally, the non-competes that make most sense provide a mechanism allowing both the employer and employee to verify and communicate that a subsequent position is not a violation, or how to insure there is no violation when it may be less certain.