While non-compete clauses are very common in Maryland, there are many myths about them that detract from employees understanding if the agreement they are signing is enforceable and businesses creating legally valid clauses. It is critical that every employer understands exactly what activities they can restrict and how to best use non-compete clauses to protect their business.
3 Common Myths About Non-Compete Clauses
- They Are Unenforceable in Maryland: Because Maryland has strict rules that can determine whether or not non-compete clauses are valid, some businesses assume that virtually all clauses are unenforceable. In reality, that isn’t the case. Noncompete agreements are completely enforceable. Maryland has four requirements to make an agreement enforceable. The clause must have adequate consideration to support the contract, be ancillary to an employment contract, be limited in duration and geographic scope, and it must not be against public policy or causing undue harm. Maryland allows portions of noncompete clauses to be enforced even if part is voidable, and the court will simply remove the unenforceable portion and enforce the rest.
- Employers Should Use Broad Noncompete Clauses Just in Case: Some businesses interpret Maryland’s rule about striking the unenforceable portion and enforcing the rest to mean that they should try to make the broadest clause possible just in case. However, this can backfire in court. Any clause that restricts an employee from being employed by a competitor in any role imaginable will not hold up, even if it does not protect your business interests. Work with an experienced attorney like Mobley and Brown, LLP to create clauses that are well-designed and enforceable.
- Once Non-Compete Clauses Are Violated, There Is Little Recourse: This myth stops many companies from getting the restitution that they are entitled to. If a former employee breaks the clause and it was valid, you can pursue preliminary and permanent injunctions, damages and liquid damages. Mobley & Brown, LLP can evaluate your case and determine the best path forward. If your trade secrets are divulged or an employee knowingly violates the contract they signed, you deserve help.
Contact Mobley & Brown, LLP for Help with Arbitration Clauses
If you are part of an arbitration agreement and unsure it if is valid or you need help and you are unsure where to turn, contact Mobley and Brown, LLP today. Our experienced legal team will work with you to meet your needs. Call us now at (410) 385-0398.
