Tortious Interference with Non Compete Agreement

Tortious interference with a non-compete agreement is a type of legal claim that arises when an individual or company interferes with an existing contract between two parties. The purpose of a non-compete agreement is to prevent an employee from working for a competitor for a certain period after leaving their current employer. In this article, we will explore tortious interference with a non-compete agreement, what it is, and how it affects the parties involved.

What is Tortious Interference with a Non-Compete Agreement?

Tortious interference with a non-compete agreement occurs when a third party induces a breach of an existing non-compete agreement between an employer and an employee. This type of interference can come in many forms, including enticing an employee to come work for a competitor, providing confidential information to a competitor, or making false statements about the employer to damage their business.

Due to the substantial potential impact on the employer`s bottom line, courts often view tortious interference with a non-compete agreement as a serious offense. To prove tortious interference with a non-compete agreement, several conditions must be met. The breached contract must be valid and enforceable, the defendant must have known about the non-compete agreement, and they must have intentionally induced a breach.

What are the Effects of Tortious Interference with a Non-Compete Agreement?

Tortious interference with a non-compete agreement can have significant effects on the parties involved. Employers expect their employees to follow the terms of their agreements and may invest considerable time and resources into training them. When an employee breaches their non-compete agreement, it can lead to a loss of customers, trade secrets, and revenue for the employer.

On the other hand, a successful claim of tortious interference with a non-compete agreement can also have consequences for the defendant. If found guilty, they may have to pay damages to the employer, which can range from lost profits to legal fees, to the cost of finding and training a replacement for the breached employee.

How to Protect Yourself Against Tortious Interference with a Non-Compete Agreement?

If an employer wants to protect their business against tortious interference with a non-compete agreement, there are several steps they can take. First, it is essential to make sure the non-compete agreement is valid and enforceable. The agreement must be reasonable in scope, duration, and geography. Second, employers should make sure that their employees understand the terms of the agreement and the potential consequences of a breach. This can be done by providing training, orientation, and clear documentation outlining the terms. Lastly, employers should be aware of any potential breaches and take appropriate action if a breach occurs.

Conclusion

Tortious interference with a non-compete agreement can have serious consequences for both employers and employees. Employers invest significant time and resources into training their employees and expect them to follow the terms of their agreements. A successful claim of tortious interference with a non-compete agreement can lead to a loss of customers, trade secrets, and revenue for the employer. On the other hand, defendants found guilty of this offense may have to pay damages to the employer or face other legal consequences. Employers should take steps to protect their business by ensuring that their non-compete agreements are valid and enforceable, their employees understand the terms, and they are vigilant for any potential breaches.