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Noncompete Agreements

Employers often require new employees to sign a noncompete agreement preventing the employee from working for a competitor if the employee quits or is fired.  In Minnesota, such agreements are enforceable but are generally construed narrowly by courts. The agreement must be reasonably limited in terms of geography and time and must be reasonably tailored to the employer's legitimate interests. Whether this test is met depends on the particular facts. The agreement might not be enforcable if the employer enforces such agreements selectively, fails to obtain such agreements from other employees, breaches the agreement, or wrongfully terminates the employee.

Further, such agreements are invalid if they are not supported by adequate consideration. Thus, if an employer requires an existing employee to sign a noncompete and provides the employee nothing in return, the agreement will generally be unenforceable.

Noncompetes are also frequently used in the sale of a business. These are generally construed more broadly than agreements between employers and employees.

If you have questions about non-compete agreements, please call me at (952) 239-0346

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