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What are some issues related to non-compete agreements?

If you are actively seeking employment in Colorado, you may be asked to sign a non-compete agreement before being made a job offer. While it is fully within the rights of the employer to request that you sign a non-compete agreement, there are a number of issues associated with unnecessary use of these documents. Accordingly, it’s important for prospective workers like yourself to be aware of the potential consequences.

Whitehouse.gov lists some of the possible issues associated with unneeded non-compete agreements. If you are required to sign such an agreement you may find that consequences are often poorly communicated, leaving you with an inadequate understanding of what an agreement actually entails. Additionally, you may have already rejected other job offers only to be obligated to sign an agreement as a condition of employment. Some claim that this deprives workers of their ability to make an informed decision, and as a result suggest that employers make any non-compete agreements known prior to the hiring phase.

There are also concerns if you are fired and must seek alternate employment. A non-compete agreement can prevent you from securing a new position in this case, thereby hampering your ability to maintain a standard of living. This is especially relevant to low-wage workers. Approximately 18 percent of the American workforce have signed non-compete agreements, and many of these workers are considered to be low earners (bringing in less than $40,000 annually).

Enforceability is another issue you should be aware of.  Agreements that are too broad in scope or that lack definition within individual clauses can be extremely difficult to impose. To this end, some states have elected to nullify those agreements that are deemed unenforceable. Additionally, agreements that inhibit public welfare may also be nullified in the interest of consumer well-being. 

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