When Non-Compete Agreements Go Too Far

When you think of non-compete agreements, you may think of them being used by technology companies with trade secrets. While that may have been the situation in the past, companies in virtually every industry are now using these agreements not only to protect themselves, but also limit employees’ ability to work.

Companies large and small are requiring that employee sign non-compete agreements. Surprisingly, hair salons use them at rates above average. Approximately 20 percent of stylists have an agreement in place. Many food service workers have also signed such agreements—but why?

Salon workers do not use anything proprietary to cut or color someone’s hair. They use procedures and tools that are standard in the industry. However, high-end salons claim that they use these agreements because of the specialized training involved.

Salons want to protect their investments, which include employees and customers. Many stylists are hired right out of school, and salons invest a significant amount of time and energy into the training process. This takes a lot of money.

When the stylist decides to leave, this can potentially be damaging to the salon owner if there is no non-compete agreement in place. The stylist takes all this information and training with him or her. If he or she has developed a strong customer base, these customers may follow. This can cause salons to lose money.

That’s why many salons enforce non-compete agreements. Many restrict employees from working within a five-mile radius for a period of one year. In some cases, agreements can last for two years and restrict employees from working within a 100-mile radius.

These types of agreements favor employers, while negatively impacting workers. These workers cannot work for competitors, so they are often forced to commute or move in order to continue working in their current industry. They are unable to move on and advance their careers. They are stuck earning stagnant wages.

Workers cannot continue fighting the battle without legal resources, and this can be difficult for low-wage workers. Many file lawsuits and have won.

After all, many clients of stylists are friends and family members, so it’s not fair for salons to claim these customers as their own. Non-compete agreements trap workers and are not a good fit for industries that rely on readily available labor.

Learn More About Non-Compete Agreements 

While there are legitimate reasons for a company to use a non-compete agreement, sometimes they go a bit too far. They often limit an employee’s ability to take on a similar job and make money, forcing many employees to move or go without work.

If you are an employer who needs help drafting an enforceable non-compete agreement or an employee who has been asked to sign such an agreement, it’s important that you understand your legal rights. Get help from non-compete agreement lawyer B.F. Godfrey from Godfrey Legal. He can protect your business or future employment and make sure all parties are adequately protected. Call his office at (407) 890-0023 or use the online form to schedule a consultation.

Resource:

usnews.com/news/best-states/missouri/articles/2018-03-23/as-non-compete-agreements-proliferate-so-do-lawsuits