Anyone who works in the business world is likely aware of the importance contracts play in a company’s success. In addition to being used to broker the sale or purchase of goods, they also can be used where services are concerned. In the case of certain business positions, contracts are put in place that outline where and when a worker can start a job with a competitor. These contracts are known as non-competes.
A non-compete agreement was recently in the news in conjunction with one of the nation’s most well-known search engines, Yahoo. Reportedly the man who was in charge of ad sales at AOL was offered a position with Yahoo. If accepted, he would become the head of the Americans sales group.
Even if the former AOL employee accepts the position, it will be some time before he is situated in his new position. This is due to the non-compete agreement he entered into with AOL when he started with the business. News reports indicate that 12 months must pass before he can officially start with Yahoo.
While not all states allow these agreements, in states where they are legal, their use is not rare. There is arguably a good reason behind them. They provide a business a way to protect itself by making it so that a worker who is privy to sensitive company information is not allowed to leave one business and turn around and put it to use with the competitor. While there are of course limits to what an agreement such as this one can contain, in most cases they are enforceable.
Source: Reuters, “Head of ad sales quits AOL after Yahoo job offer – report,” Alexei Oreskovic, April 11, 2013