Noncompete agreements were used for many different reasons. They helped employers retain workers by limiting their options to switch jobs. They also helped employers protect intellectual property. If workers had to learn about certain recipes, designs or other key pieces of IP to do their jobs, there was less risk that they would simply take that knowledge to the competition unexpectedly. They were prohibited from doing so.
However, things have changed significantly over the years. Last year, the Federal Trade Commission banned noncompete agreements in most cases. Does this mean that your company’s intellectual property is at risk because your employees are now free to switch jobs whenever they want?
You still have other legal tools
This can make things a bit more complex, and there is a greater chance that your employees could leave and work for the competition. That said, there are other legal tools you can use to protect your intellectual property if this happens.
For example, you could have employees sign nondisclosure agreements revolving around certain types of information. They may be allowed to work for the competition, but they still have to honor the NDA.
Additionally, you may need to consider tools like patents, trademarks or copyrights. If your company designed a new invention, former employees may certainly know how the design works, but if you have patented that design, your competition still cannot use it.
Your legal options
Protecting intellectual property rights is very important for business owners, as these can be some of the most valuable assets the company owns. Be sure that you know exactly what legal steps to take.