Can a non-compete be enforced if I quit my job to become self-employed?

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Can a non-compete be enforced if I quit my job to become self-employed?

I work in the field of massage. When I was hired at my current job, I was required to sign a non-compete agreement saying I couldn’t work for a competitor within a 60 mile radius for a period of 24 months. Does this mean I am not allowed to work in my current field for 24 months if I stay in my location, or that if I want to work I have to move? If I chose to start my own business in a specific area of massage that my employer does not offer, could this non-compete be enforced? In other words, would I be considered a competitor? I did not receive any other incentive for signing this agreement, this was also my first job after finishing school.

Asked on August 5, 2011 Colorado

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

First, you don't need any other incentive, other than being employed, to make a non-competition agreement binding; the employment itself is enough to bind the agreement. If you are not willing to be bound to a non-competition agreement, your recourse is to not sign it and not take the job.

Second, if you open up your own business which competes with your employer, or provide services as a self-employed person or freelancer which compete with the employer, then you would be "competitor" for purposes of the non-competition agreement. You don't have to work for an established competitor to compete--you just need to compete.

Third, as to whether the "specific area of massage that my employer does not offer" would be competition, there is no simple answer. It depends on the specific facts, including how likely it is your employer would offer these services; whether you might draw customers or clients from them; and exactly how the agreement is written. For a definitive answer, you need to consult with an employment lawyer who can evaluate the agreement and the situation in detail.


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