WASHINGTON: Overbroad, anticompetitive noncompetes are unenforceable
Three different versions of a noncompete agreement, signed by three employees hired at different times, were too harsh to be enforced, said a federal district court in Washington. The employer, which specialized in artificial insemination of livestock, sued the workers when they left to work for a competitor.
Two of the employees’ noncompete agreements prevented them from contacting any customers they communicated with while employed with the company. The court looked at this prohibition, and found that it was too harsh and overly broad. Essentially, this restriction would have prevented the employees from contacting companies who weren’t even customers, but were merely prospects or interested in services. The third employee’s noncompete was thrown out because it prevented him from encouraging other employees to quit, but the court found that the employee had simply quit his own job, not encouraged others to quit (Genex Cooperative, Inc. v. Contreras, ED Wash, Oct. 2014).
Tips: Washington courts, like many across the country, are reluctant to enforce overbroad noncompete agreements. When interpreting Washington employment law, courts will look at the interests the business is trying to protect in the agreement; the reasonableness of the duration and geographic area in the agreement; the potential loss of the employee’s skills to the public; and whether the employee received something of value, like a job or a promotion, when they signed the agreement.
Reach out to your Vigilant employment attorney for help navigating noncompete clauses and other employment law issues. For more information, see our Legal Guide, “Noncompetition Agreements.”