The modern business landscape is highly competitive and the battle for the best talent is only intensifying. With employers offering increasingly comprehensive compensation packages, a non-compete clause is an attractive option for many employers. But, without a solid understanding of the legal implications of including a non-compete clause in a contract, both employers and employees alike could face serious trouble down the road.

When it comes to non-compete clauses, employers based in Los Angeles must be aware of the state’s laws and regulations. Of course, even with the best of intentions, an employer may run afoul of the law. To ensure that their rights are respected and protected, employers in Los Angeles can tap into the experienced network of legal professionals available through UpCounsel.

In this article, we'll go over the top five things to consider when it comes to drawing up a non-compete clause. By thoroughly exploring the ins and outs of non-compete clauses, employers can be confident that they'll be able to build and maintain strong teams in this increasingly competitive landscape.

1. Think Like a Lawyer

When it comes to non-compete clauses, it's essential to think like a lawyer. That means going far beyond what seems reasonable and taking the time to read through clauses to ensure that all parties are adequately protected. Many employers make the mistake of grabbing a non-compete clause from the internet and assuming that it's comprehensive enough, but this is rarely the case.

Legal professionals understand the importance of drafting clauses that protect both the employer and the employee. This can include clauses that dictate which types of roles the employee can't take for competing employers and what sort of information can be shared. At the same time, legal professionals will ensure that employees aren’t restricted to a degree that could be perceived as being oppressive. After all, you want to hire and retain the best talent – not alienate them.

2. Add a Non-Compete Clause Only if Absolutely Necessary

In most cases, it's best to avoid including a non-compete clause in an employment contract when it's not absolutely essential. As mentioned before, this sort of agreement can be seen as oppressive, and employers may find it more difficult to attract and retain key employees.

Non-compete clauses may be useful in certain situations, such as for executives who are privy to company secrets, or when there's a risk of them taking key contacts and customers with them if they leave the firm. If you do include a non-compete clause in a contract, make sure it’s very specific.

3. Understand Local Regulations Regarding Non-Compete Clauses

Laws vary from state to state, and it's important to understand the regulations regarding non-compete clauses in the city or state in which you are operating. In Los Angeles, non-compete clauses can be limited depending on the circumstances, and a court may take a dim view of overly broad agreements.

As employers in Los Angeles scramble to get the best talent in a competitive market, it's easy to be lured into believing that non-compete clauses are a one-size-fits-all solution. It's essential to remember that non-compete clauses, when used inappropriately, can do more harm than good – both for the employer and the employee.

4. Non-Compete Clauses Should Be Reasonable

Even if non-compete clauses are legally enforceable, the question can be asked of whether they’re reasonable. Generally speaking, if a clause is overly broad, it won’t be seen as reasonableness in the eyes of the court.

The length of time that a clause covers, the geographic area in which the employee is limited, and the nature of the restrictions placed on the employee can all come into play here. Everyone’s situation is unique, but the overall goal should be to balance both the interests of the employer and the employee.

5. Seek Professional Legal Advice

Finally, employers in Los Angeles should be aware that professional legal advice is essential when it comes to non-compete clauses. It's easy to make a mistake when drafting these sorts of clauses, and the effects can be disastrous for both the employer and the employee.

UpCounsel makes it easy for employers in Los Angeles to get the legal support they need to ensure that their non-compete clauses are enforceable, reasonable, and advantageous to both parties. Their vibrant network of experienced lawyers can provide the best advice and counsel, so employers can rest easy knowing that their contracts are being taken care of in the best possible way.


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