Non compete and confidentiality agreement.

Asked 4 months ago - Yuma, AZ

We have 17 employees for 8 years.
We made all our employees sign a non compete confidentiality agreement. All employees signed it, except one. No reason was given.
Do I have to give my employees something "in exchange" when I ask them to sign an agreement that benefit the company?
Or can I simply tell him if you don't sign you cannot work for me anymore?
Are they any possible legal consequences for me to say it like this?

Thanks,

Attorney answers (5)

  1. Michelle Ray Matheson

    Pro

    Contributor Level 7

    4

    Lawyers agree

    1

    Best Answer
    chosen by asker

    Answered . Your question is interesting because the answer to this question varies greatly on a state by state basis. Many states do require an employee to provide additional monetary consideration (such as a bonus or stock options) in order to bind an employee to these types of promises. Arizona is not one of those states. As a general rule, the fact that an employer continues to employee the individual is sufficient consideration to support the agreement. However, as the other contributors point out, whether or not the restrictions in the agreement are enforceable is a fact specific inquiry, which depends on what the employee's job duties are, how long the post-employment restrictions are in place, and what geographic areas are included.

  2. Trent D. Woods

    Contributor Level 7

    Answered . There is no way to know if a court would uphold your non-compete and confidentiality agreements, without reading the actual agreements. Courts have certainly upheld both types of agreements, while other courts have struck down those types of agreements. Typically, such agreements are very fact specific and the agreements must be reasonable restrictions on the employees. You should consult a local employment law attorney so that he or she can review your agreements.

    My comments are for general information only and should not be construed to create an attorney-client privilege... more
  3. Jacques Tushinsky-Fox

    Contributor Level 12

    Answered . You have asked many questions. Some are difficult to answer. The confidentiality agreement would be enforceable against the employees, but the restrictive covenant not to compete would not. I would retain a good labor law attorney to help you deal with these issues.

  4. Brian D. Swan

    Contributor Level 11

    Answered . I take the opposite opinion of my colleague; and this is why litigation ensues—disagreement is the name of the game.

    You're well advised to talk to an attorney because every court treats non-compete's differently. Some courts don't like restrictions on an employees right to compete in the workplace; other courts don't mind them as long as they're reasonable in their scope. As far as the validity of the agreement goes, the consideration for the agreement is met by the employees refraining from competing (something he has a legal right to do) and your giving him continued employment to do so. So, I would be inclined to say the agreement is enforceable. (Obviously, my opinion is based only on what you've given me and I have not read the entire agreement.)

    So the question about whether you can fire him? Sure. You are an at-will employer and may fire any employee for any reason or no reason whatsoever.

    The answer to your question is not intended as legal advice or counsel. Because of the minimal facts involved in... more
  5. Pearlette Vivian Toussant

    Pro

    Contributor Level 16

    Answered . I will not break the tie in opinions between my colleagues (the prior two responses) and offer any specific advice regarding your restrictive agreements, however, I will echo the sentiment that you need to have an attorney on board to answer these questions, draft agreements, and give you legal advice with regards to your business and legal matters. Find one local to you by using Avvo's Find a Lawyer feature or contact your local bar association for a referral. Good luck.

    Answer given for general advice and is not a legal opinion, which would require an analysis of the facts and... more

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