How to Get Started with Non-Compete Agreements in Chicago
The Importance of Non-Compete Agreements for Chicago Business Owners and Executives3 min read
For business owners and executives based in the city of Chicago, non-compete agreements are essential to protect the integrity of your business and products. Additionally, they can be used to protect your investments and ensure that, in the case of a split, valuable employees stay in your specific area of expertise. But, if you’re unfamiliar with non-compete agreements, you may not know how to get started.
In this article, we’ll discuss the basics of non-compete agreements, the laws surrounding them, and how to successfully navigate the process. We’ll also provide some tips to ensure your non-compete agreements are legally binding and enforceable. Let’s get started.
What Are Non-Compete Agreements?
At their core, non-compete agreements are contracts that forbid contractual parties from competing with each other. Generally, they last for a predetermined duration and geographic area within which a specific activity can’t be done. Non-compete agreements are key components in protecting the interests of employers in the case of a dispute, and they can also protect contractors from being taken advantage of.
Keep in mind, however, that non-compete agreements are always subject to state laws. While abandoned contacts or non-payment of services might make a non-compete agreement unenforceable, it’s important to understand that there are limitations to when a non-compete agreement can be activated. For example, in the state of Illinois, it’s illegal for a non-compete agreement to have a duration longer than five years, and therefore, may be unenforceable. Be sure to consult an attorney to ensure your agreement is legally binding and enforced when necessary.
How Can You Start the Process?
When it comes to implementing a non-compete agreement within your business paperwork, it’s important to ensure realistic terms. Start by specifying the specific roles the agreement should be used for or to what type of business endeavors it should apply. If you’re a Chicago-based business owner or executive, then you’ll also need to ensure the agreement is compliant with both Chicago’s rules and state-wide regulations.
The wording of the document should also be carefully considered. Typically, the document should outline rights and responsibilities of both the employee and employer in clear language. It should also make it clear who would be responsible should a dispute arise and what sorts of damage can be enforced in the case of a breach of agreement.
It’s also important to remember that non-compete agreements only work if they’re fair to both parties, so make sure to be reasonable when forming the document. Consider the employee’s level of experience, compensation, and any potential legal ramifications they may face if the agreement is breached.
Getting the proper legal support is also essential, as you’ll need to make sure to document the agreement properly. Look for legal firms with a specialty in non-compete agreements, as they would be the best equipped to answer your questions in detail. Alternatively, UpCounsel can put you in touch with experienced business lawyers in your area who will craft personalized non-compete agreements based on Chicago and Illinois laws.
Tip for a Successful Non-Compete Agreement
Whether you’re an employer or an employee, it’s important to keep some things in mind when drafting a non-compete agreement.
First, determine in what manner the agreement may be terminated. If termination is to be done by one of the parties, then the terms should be specified. Additionally, examine any legal repercussions or damages that may be required in the case of an employee breach of agreement. By knowing the legal paths in advance, you can ensure that any dispute that may arise is handled without further difficulty.
Finally, always make sure to read the fine print thoroughly. Pay particular attention to the scope and duration of the agreement. An overly-restrictive agreement may not be legally enforceable, so make sure to review the language involved carefully before signing the document. Additionally, make sure both parties are on the same page in understanding the agreement.
Non-compete agreements are important and effective tools to protect valuable information, investments, and expertise. They can help to prevent competitors from taking advantage of your businesses’ knowledge and resources, and can also protect employees from being subject to unlivable conditions or forced into working outside of a contract agreement.
To ensure your specific non-compete agreement is legally binding and lawful within the chicagoland area, it’s important to work with experienced attorneys who understand state and city regulations. For businesses based in Chicago, UpCounsel provides options to connect with experienced legal specialists in non-compete agreements.
By knowing how to get started and the potential pitfalls you may face, you can be sure to burn through the legal complexities of non-compete agreements with ease.