Does Signing a Non-Compete Agreement Mean I Can Not Start my Own Business?

Written by Ravi Sattiraju on March 23, 2017

When you are asked to sign a non-compete agreement, you are asked to avoid working with your employer’s competitors for a specified period of time following the end of your employment. This agreement generally prohibits certain job titles and duties for direct competitors within a specific geographical area. It is done to protect your employer’s investment in your skills as a worker, preventing competitors from profiting from the time and money your employer spent on your specialized training and development. But what determines a competitor? What if you decide to start your own business within your field, becoming your previous employer’s competition?

This is an issue to discuss with an experienced employment attorney. The specific details of your non-compete agreement can restrict you to the point that you have to put your career on hold after terminating your employment, which is not fair to you. Before starting your own business, discuss your employment contract with an attorney in New Jersey to determine your rights as a worker and entrepreneur.

Am I Barred from Starting my Own Business?

You could be. Depending on the terms of your non-compete agreement, you could be barred from starting your own business if it falls within your employer’s definition of direct competition.

Ask yourself the following questions to determine if your business would violate your non-compete agreement:

  • Does my proposed business rely on the same technology, the same products, or the same strategy as my employer?
  • Am I seeking the same customer base as my employer?
  • Am I making use of my specialized skills or knowledge in my new company, or am I primarily using skills that could be learned anywhere?

Work through these questions with an employment attorney to better determine if your business idea would violate your non-compete agreement with your employer.

Contact Our New Jersey Attorneys

Non-compete agreements can be complicated and in some cases, restrictively binding. If you have been asked to sign a non-compete agreement as part of your employment contract, do not sign it until you have reviewed it with an experienced employment attorney. Our team of New York and New Jersey employment attorneys at The Sattiraju Law Firm, P.C. can review your proposed non-compete agreement and if it is not reasonable, help you draft a better agreement to submit to your employer. You have the right to pursue your career goals. We can protect that right.

Posted Under: New Jersey Employment Law
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