If you intend to run a business, make sure you take the necessary measures to secure your profits and trade secrets. A Utah non-compete agreement is one of the recommended documents that can protect the employer from dishonest responses of current and prior employees. It also guarantees that action is taken in case of an NCA violation.
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Limiting and preventing unfair competition between former partners (an entity and an employee or two business entities) is the fundamental purpose of this type of non-compete agreement template. However, certain conditions should be met to make the paper legally binding. Unreasonable demands and liabilities are likely to be declined in court.
Non-competes are beneficial to employers for obvious reasons. However, very few people realize their purpose. Utah (or any other state) non-compete covenants can restrain monopoly provided they contain reasonable terms. To benefit from such a contract, the employee should attentively study its contents, discuss all vague or doubtful statements (if any) with the employer, and sign it only when the listed conditions are clear.
The Basic Components of a Non-Compete Agreement
Utah does not specify any particular requirements to maintain fair competition. Still, legally correct non-compete covenants should provide the following contents:
Non-compete divulgence terms. This part covers business practices and relations with current and former company’s clients, vendors, partners, competitors, and other employees.
Period specifications. Since Utah doesn’t provide specific business competition regulations, the employer and the employee should reasonably designate the liability period within which the latter will maintain commitment not to trespass the agreement terms or disclose the company’s confidential data.
Geography specifications. Here, the signatories specify the geographic area where the employee should not do the same business for a designated period.
Liability release details. This section specifies whether there are conditions to terminate the non-compete covenant before its expiration date. The signatories discuss the options and submit the alternatives.
Confidential data definition. The section specifies which data is sensitive or has commercial value. The recipient must not disclose this information to third parties.
This NCA point indicates the state and the territory statutes that regulate the restriction of unfair competition issues.
Law regulations. Should any NCA breach occur, the affected party has a legal right to take corresponding measures and file a lawsuit, if needed.
The parties’ signatures. Once the agreement is negotiated and approved, the parties sign the paper. All further amendments must be registered in writing. Otherwise, the adjustments will have no legal effect.
Popular Local NCA Forms
Non-compete contracts are recognized and enforced to some degree by the majority of US states, which makes them fairly popular among many organizations. Read more about the most common states searched by our users concerning non-compete agreements.
Although some states establish restrictions to non-competes, Utah statutes do not render any specific recommendations and limitations. Therefore, to protect the company’s trade secrets and sensitive information, it is advisable to sign a non-compete agreement.
The state citizens are empowered to choose the conditions of non-compete agreements. However, there are certain cases when the covenant is considered invalid:
Duration of the contract. Should the active period of the covenant be too extensive, the court may deem it illegal.
Geographic coverage. The relevancy and validity of the non-compete covenant will also be questionable if the Utah court authorities find the geographic scope too broad.
Professional field. The company should apply restrictions only to those spheres it directly provides services. Distantly related or neighboring fields can cause issues and result in invalidation of the non-compete covenant.
The Bottom Line
To crown the afore-mentioned, ensure to register all negotiations in a written manner. It is vital because Utah doesn’t provide specific securing measures to restrict malevolent actions in case of an NCA’s excessive use. Once the agreement is fairly structured and properly certified, it serves as a legal guarantee of the arrangements and is protected by the court (when necessary).
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