Why having non-compete agreements is important for businesses

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Why Having Non Compete Agreements Is Important For Businesses

Many businesses in New Jersey provide similar services or products as other businesses. Due to this they compete with each other for clients and customers. There are differences between companies who compete with each other though and those differences are what set them apart from their competition. It is important that these differences are kept with the company to protect them to continue to give them an edge over their competition.

It is also important that companies can keep their employees who know these secrets or have relationships with clients from bringing these relationships to their competition. To protect against this companies can require their employees to sign non-compete and non-disclosure agreements.

Benefits of non-compete agreements

These can be very beneficial for companies. The agreements prohibit employees from working for competitors and disclosing their trade secrets, which is important for the overall success of the business. It can create less employee turnover as the employees know that their options are limited if they decide to leave. They can also allow companies to invest more into training employees knowing that they will not lose their employee to competitors after spending the time and money to train them. Better training can lead to better and more productive employees.

There are benefits of these agreements, but they need to be drafted correctly though in order to be enforceable. They must clearly state a specific time period that it is in place and the time requirements must be reasonable. The agreements also can be too restrictive in the types of businesses employees can go to or too broad in the geographic area they cover.

For companies in New Jersey, it can be devastating to learn that their non-compete agreement is not enforceable after it is too late to fix the problem. Experienced attorneys understand the elements of non-compete agreements and may be a useful resource.


Michael Ritigstein is a Founding Partner of the firm concentrating his efforts in supporting the firm's litigation, corporate and estate matters. Mr. Ritigstein graduated from the University of Delaware in 1996 and Seton Hall University School of Law in 2000. In 2007 he received a Masters of Law in Taxation with a concentration in Estate Planning, from Temple University's Beasley School of Law.

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