North Carolina Non-compete Agreement Template

A business or entity (recognized as the “employer”) may decide to give a hired individual or proprietor access to specific data and sensitive information in certain conditions. In this review, we will dwell on the importance of the North Carolina Non-Compete Agreements and local laws that regulate the process and guarantee business safety.

Unfortunately, there are plenty of cases when a dishonest business partner takes advantage of the situation and uses confidential information for their benefit. Consequently, these actions jeopardize the employer’s prosperity and reputation and may even result in a business smashup.

Thus, the fundamental purpose of the covenant not to compete form is to prevent these unfavorable circumstances and limit the other party’s decisions after the partnership is terminated. On the other hand, it is essential to understand that the hired person is restricted from certain activities. That is why they should be aware of any disclosure they give written consent to.

The U.S. laws do not provide universal rules regulating the non-compete process. Every state has its laws and restrictions. In North Carolina, non-compete agreements are part of employment contracts and should not be executed separately. Both signatories must provide their identities and agree to follow the prescribed regulations. The documents may vary in structure, but any non-compete agreement should contain the following data:

  • Parties identification, including the names and sometimes, address
  • Non-compete disclosure section
  • The validity period of the agreement
  • Liability release through purchase (if applicable)
  • Jurisdiction data
  • Sensitive information and confidentiality details
  • Penalties or cure for agreement violation
  • Signatures and date

In the next part of our review, we will cover the inherent components of the non-compete disclosing procedure and North Carolina laws securing it.

Popular Local NCA Forms

Many firms frequently prefer to prevent their employees from revealing trade secrets to the company’s competitors when their relationship ends. Different states have different restrictions and policies regarding non-compete clauses. Below are some of the most popular local NCAs searched by the users of this website.

North Carolina NCA Laws and Restrictions

In North Carolina, the procedure of securing the entity’s confidentiality and creating non-compete covenants is regulated by Chapter 75 (Monopolies, Trusts, and Consumer Protection) of the NC General Statutes.

Following Section 75-4, all covenants must be performed in a written form and comprise terms regarding the potential usage of sensitive information. No individual, proprietor, full-time employee, and other workers can be restricted from running a business in any U.S. territory unless the employer complies with this rule. The North Carolina standards do not affirm non-compete agreements and claim the following:

  • Non-compete covenants are part of the employment agreement.
  • Non-compete covenants must be registered in writing and contain both signatories’ written consent to comply with the introduced terms.
  • The covenant should designate a reasonable active period and list the regulated territories.
  • Public police hostile agreements are illegal.
  • Both parties must sign and date the covenant.
  • Physicians are exempt from all non-compete limitations.

All violations, be it on the employer’s behalf or due to the employee’s unreasonable or malevolent spread of information, should be recognized. The respective authorities should consider each case separately. If you understand that the covenant’s terms have been breached, you can prosecute the trespasser in court. If the higher authorities rule in your favor, the offender will have to refund.

Quitting a Non-Compete Covenant

The terms of legal termination of a non-compete agreement should be introduced in the document. Otherwise, you need to make written amendments and register the necessary adjustments.

If the signatories fail to come to terms, the complainant can file for a lawsuit relying on one of the below-listed grounds:

  1. The covenant covers business fields the employee does not relate to.
  2. An inadequate limitation period set out by the non-compete covenant.
  3. The document covers injudicious territories; for example, the NCA states that the complainant is not exempt from the covenant countrywide.
  4. The employer’s manipulations and misleading preliminary assessment.
  5. The business field is the only profit source for the employee and their family.
  6. Discrimination by race, age, religion, nature, gender, and other factors.

The Bottom Line

North Carolina non-compete regulations allow both the employers and employees to keep the balance of reasonable business maintenance. However, once they provide their written consent, the contract becomes legally binding.

Please ensure attentive management of the pre-employment period and sign the paper only if everything is clear and makes sense to you.

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Use our maker to customize any form available on our website to your needs. Here’s a range of various other popular North Carolina documents we provide.

Published: May 5, 2022
Jennifer M. Settles
Jennifer M. Settles
Author & Attorney
With over 25 years of experience as a business and transactional attorney, Jennifer has mastered the craft of closing highly successful deals for her clients. Through her wide-ranging expertise in commercial contracts, real estate transactions, M&A and corporate law, Jennifer secures results that are second-to-none.