North Carolina`s only legal provision dealing directly with non-competition requires that any contract that restricts a person`s right to do business anywhere in the state be in writing and signed.1 However, this law does not directly address when such agreements constitute an authorized restriction on trade. Like most other states, North Carolina courts were only willing to enforce such agreements if they were “appropriate in time and territory.” 2 The adequacy analysis shall include a detailed examination of the worker`s previous employment position, as well as the skills and knowledge acquired, in order to ensure that the limitation is not broader than is necessary to protect the employer`s activity3 in terms of time and territory. In North Carolina, there is no defined formula for an acceptable time or territory limit. The only condition is that such restrictions are “appropriate”. As regards time limitations, the basic rule is that otherwise applicable competition prohibitions are appropriate for a maximum period of two years. There are a few precedents in North Carolina that maintain competition bans for more than two years, but these cases are rare. The adequacy of territorial restrictions does not depend solely on the size of the territory described in the non-competition clause. Instead, courts are more inclined to verify where your employer`s clients are and whether the territorial scope of the agreement is necessary to maintain these customer relationships. If you only worked in Forsyth County and the surrounding 4 or 5 districts, a non-compete clause that prohibits you may be too broad in Raleigh or Charlotte, which could result in the non-compete clause being lifted. If you`ve worked with your employer`s clients in all 100 Counties of North Carolina, from Murphy to Manteo, a larger geographic restriction may be considered appropriate.
In short, the courts will consider, among other things, the following information: the area or extent of the restriction, the area in which you have worked, the nature of your business and the nature of your obligations and responsibilities, as well as your knowledge of your current employer`s activities. In addition, North Carolina`s “Blue Pencil” rule severely limits what a court can do to change a bund that is too broad. At most, a court may choose not to apply a part of the covenant, which is clearly separable, in order to make the provision appropriate. However, a court may not revise or rewrite the Confederation by any other means. In Andy-Oxy, the overly broad language of the non-competitive alliance was not a clearly separable part of the Confederation and, therefore, the whole Confederation was not applicable. Employers are extremely aggressive when it comes to non-competition, bans on debauchery or trade secrets. Herrmann and Murphy`s lawyers are experienced in defusing these situations before litigation becomes inevitable and in defending those accused of misconduct. You should contact a consultation immediately if your former employer sends you a letter claiming that you are violating any of these agreements or trade secrets..
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