Noncompete agreements are contracts that are typically signed by employees when they are hired to prevent them from working for a competitor within a certain period of time after leaving their current job. These agreements are designed to protect the employer`s intellectual property and trade secrets by preventing former employees from using that knowledge to benefit a competitor. In Tennessee, noncompete agreements are enforceable under certain conditions, but there are also limitations to their use.
Under Tennessee law, noncompete agreements must be reasonable in duration and geographic scope. Typically, this means that the agreement cannot prevent an employee from working in their chosen field or industry for an unreasonably long period of time or in a geographic area that is too large. In addition, noncompete agreements must be based on a legitimate business interest. This means that the employer must have a valid reason for requiring the agreement, such as protecting their trade secrets or customer relationships.
There are also certain types of employees who are exempt from noncompete agreements in Tennessee. For example, doctors, lawyers, and other licensed professionals are generally not subject to noncompete agreements because they are considered essential to the public welfare and their clients` best interests. In addition, employees who earn less than $500 per week or work in certain industries, such as broadcasting or newspaper publishing, may also be exempt from noncompete agreements.
If an employer breaches a noncompete agreement in Tennessee, the employee may be entitled to damages and other remedies. These can include monetary damages for lost wages or other financial losses, injunctive relief to prevent the employer from enforcing the agreement, and even attorney`s fees and court costs.
Overall, noncompete agreements can be an effective tool for employers to protect their intellectual property and trade secrets. However, it is important that employers in Tennessee comply with the legal requirements and limitations of these agreements to avoid legal disputes and potential liability. Likewise, employees should carefully review any noncompete agreement before signing and seek legal advice if they have any questions or concerns.