Legal Question in Employment Law in Utah

Non Competitive Agreements

My employer is having me sign a new non competitive agreement. The new one states that even if they lay me off or terminate me, I cannot work for a competitor, or even go work for a customer-- is this legal? I understand their concern if I leave voluntarily-- but I feel it is too restrictive if I am laid off.


Asked on 5/02/08, 4:06 am

2 Answers from Attorneys

Alvin Lundgren Alvin R. Lundgren, L.C.

Re: Non Competitive Agreements

You are not required to sign it. You can also negotiate different terms. However, your employer may fire you, and then you would be entitled to unemployment.

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Answered on 5/02/08, 10:14 am

Re: Non Competitive Agreements

Yes, it is legal in Utah. However, as lawyers often say, "It all depends." The law recognizes them as legal but does not favor them, meaning that they are only enforceable if "reasonable" under the circumstances. That is, they must be reasonable as to what limitations are placed such as the period of time of the restriction and the geographical area of the restriction in the context of the nature of the work or industry. For example, if you're a gardener it would not be reasonable for a 10 year, 500 mile restriction, but a 3 month 5 mile restriction may be "reasonable" under the circumstances (you could be a gardener immediately if further away than 5 miles or after 3 months inside the 5 miles limit).

Those are the basics (sometimes can be even more involved). Again, "It all depends" on those factors whether the non-compete is enforceable.

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Answered on 5/02/08, 12:04 pm


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