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The Internet Compass

Careers

Non-Compete Clause

A non-compete clause is a contractual restriction preventing an employee, for a defined period and often within a defined geography, from working for a competing employer or starting a competing business after leaving their current employer.

Enforceability varies enormously by jurisdiction: some states restrict or void non-competes for most employees, while others enforce them if narrowly scoped in duration, geography and role. Regulatory attention on non-competes has increased in several jurisdictions specifically because of their effect on wage growth and job mobility.

Non-competes are distinct from non-solicitation clauses (restricting poaching a former employer's clients or staff) and non-disclosure agreements (restricting sharing confidential information); an offer can include any combination of the three, and each is evaluated differently.