Contracts must be fair and balanced for them to be legally valid and enforceable. Especially in scenarios where one party must make substantial concessions when signing a contract, the other party must also make concessions or provide something of value.
That standard applies to employment contracts much as it does to any other written agreement. If employers require that their workers sign contracts, they generally need to provide something of valuable consideration to those employees to compensate them for any concessions that they make.
What constitutes valuable consideration?
Businesses demanding that workers agree not to start competing businesses or take jobs with similar organizations have to offer something to offset the potential hardship generated by those demands. Workers often do not realize what their employers provided in exchange for signing the agreement.
Much of the time, what the worker receives in exchange for signing a non-compete agreement is an employment opportunity. Companies require that workers sign these agreements during the onboarding process or when accepting a new position with a more prestigious title and a better compensation package.
If employers demand that existing workers sign non-compete agreements, they must offer something of value to ensure that the contract is fair and enforceable. Frequently, companies may offer a minor one-time signing bonus or grant workers an extra day of paid leave as the valuable consideration provided in exchange for signing a non-compete agreement.
Professionals questioning whether their employers can enforce a non-compete agreement they previously signed may need assistance evaluating the agreement itself, their new business or employment opportunities and what, if anything, the company provided to them in return for giving up future economic opportunities. Reviewing the contract with an employment law attorney can help concerned workers avoid or effectively respond to non-compete enforcement attempts.