Contract Clause Guide

Non-Compete Clause: What It Really Means for You

A non-compete clause restricts your ability to work for competitors or start a competing business after leaving a company. These clauses can significantly impact your career mobility and earning potential.

Example Clause

Employee agrees that for a period of two (2) years following termination of employment, Employee shall not, directly or indirectly, engage in any business or employment that competes with the Company's business within a 50-mile radius of any Company location.

What This Means

This clause prevents you from working for any competitor or starting a similar business for 2 years after you leave, within 50 miles of where the company operates. This could severely limit your job options if the company has multiple locations.

Common Risks to Watch For

1

Overly broad geographic restrictions that limit job opportunities

2

Excessive time periods (more than 1-2 years is often unenforceable)

3

Vague definitions of 'competing business' that could apply to many industries

4

No compensation during the restricted period

5

Applies even if you're terminated without cause

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