Restrictive covenants are agreements that restrict your ability to compete with your former employer after you leave. You may be required to sign a non-compete agreement in order work for a company. The stated goal of these covenants is to protect trade secrets and other confidential material. However, employers will often use them as an intimidation tactic to prevent employees from leaving the company.
At Biesecker Dutkanych & Macer, LLC, our Indianapolis lawyers have more than 50+ years of combined experience protecting the rights of employees. If you feel a non-compete clause in your employment contract is too restrictive, we can help you.
Examples of Restrictive Covenants
- Non-compete clauses: One of the most common restrictive covenants, often broad in nature. Generally, these clauses will prevent you from working for a competing company or starting your own company that directly competes.
- Non-recruitment / non-solicitation clauses: Restricts your ability to hire employees of your ex-employer for a length of time after employment is terminated.
- Confidentiality provisions: Perhaps the most common form of restrictive covenants. These are often signed by employees outside of a contractual agreement. These restrict your ability to use any trade secrets or confidential information after you leave the company.
In most cases, other restrictive covenants are all seen as support for confidentiality provisions. These provisions restrict specific activities that could lead to a breach of said provisions.
Can Restrictive Covenants Be Enforced in Indiana?
In Indiana, judges decide if a non-compete is enforceable based on whether or not it is reasonable. The state of Indiana has some of the highest standards for non-compete agreements. Generally, such contracts or covenants are discouraged under Indiana law, as they can result in a power imbalance between employer and employee.
Below are the two main factors that determine the reasonableness of a non-compete agreement:
- If the restriction is essential to protecting an employer's legitimate business interests
- If the restriction itself is reasonable, allowing the employee to seek employment without being forced out of their profession
When it comes to protecting legitimate business interests, Indiana law recognizes an employer will want to protect certain advantageous factors. This includes good will, trade secrets, and confidential information. However, this would not cover something like the general experience gained by the employee during their employment.
In terms of determining the reasonability of the restriction, factors such as the period of time, geographic area, and activities restricted are considered. Non-competes will likely be unenforceable if they are intended to be in effect for several decades, or if they prohibit all competition from anywhere in the United States.
In some cases, the restrictions put forth by these covenants are fully legal and will be tough to combat. For many more employees, however, these agreements can be unlawfully restrictive and may even be challenged in court. Due to the complexity of these cases, it’s vital to contact an attorney with experience in non-compete law.
Contact Biesecker Dutkanych & Macer at (317) 537-9920
Our skilled attorneys have stood for the rights of employees for more than five decades. When you hire our firm, we will take the time to learn about your specific case. Our attorneys will craft a personalized, maximally effective legal strategy with your best interests in mind.
Retain a tireless advocate for your employment rights. Call Biesecker Dutkanych & Macer, LLC today at (317) 537-9920.
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