When an employee leaves a company, they often take with them valuable knowledge and skills acquired during their tenure. To safeguard against the potential loss of proprietary information or competition from former employees, Mississippi non-competition agreements can be a useful tool for business owners. In the state of Mississippi, drafting an effective non-compete agreement can be challenging.
A document that is too restrictive may not adequately protect the company’s interests, while one that is too broad may be deemed unreasonable and unenforceable. Hence, it is crucial for businesses to strike a delicate balance when crafting such an agreement. This will ensure that the agreement provides the necessary protection without infringing on the rights of former employees. With a well-crafted non-compete agreement, business owners can maintain the integrity of their business and safeguard their hard-earned success from potential competition.
Whenever in doubt, our non-compete agreement attorneys in Biloxi are here to assist you. , Call us at (228) 374-2313 or fill out our online form to arrange for an initial consultation. We look forward to hearing from you and look forward to the opportunity to serve as your attorneys.
Mississippi Non-Competition Agreements
A Mississippi Non-Competition Agreement is a contract that restricts an employee from competing with their former employer for a specific period after leaving the company. In Mississippi, non-compete agreements are generally enforceable if they meet certain requirements.
To be enforceable, a non-compete agreement in Mississippi must be reasonable in duration, geographic scope, and the type of work prohibited. The duration of the agreement should be limited and cannot be more than two years. The geographic scope must be reasonable and should not extend beyond the area where the business operates or where the employee worked. The type of work prohibited should be narrowly tailored to only restrict competition that is related to the employee’s work with the former employer.
However, there are some restrictions on the use of non-compete agreements in Mississippi. For example, they are not enforceable for low-wage employees, and they cannot be used to prevent an employee from working in their chosen profession. Additionally, the employer must provide consideration (something of value, such as a bonus or a promotion) to the employee in exchange for signing the non-compete agreement.
It is important to note that the enforcement of non-compete agreements in Mississippi is determined on a case-by-case basis. Courts will consider various factors, such as the employee’s job duties, the scope of the non-compete agreement, and the reasonableness of its restrictions, when deciding whether to enforce the agreement.
Businesses in Mississippi should carefully consider the language and scope of a non-compete agreement to ensure it is both legally enforceable and provides adequate protection for their business. It is always recommended to consult with an attorney to draft an effective and enforceable non-compete agreement.
Mississippi Courts Look Skeptically at Non-Competes
The Supreme Court of Mississippi has expressed a general aversion to restrictive covenants or non-compete agreements, citing that they limit individual freedom and can act as restraints on trade. This view was expressed in the case of Cain v. Cain, 967 So.2d 654 (Miss.Ct.App. 2007). Given this predisposition, non-compete agreements in Mississippi are subject to strict interpretation and enforcement. It is the responsibility of the company that seeks to enforce a non-compete agreement to demonstrate that the restrictions placed upon an employee are reasonable in light of the economic interest they seek to protect. This burden of proof is critical to ensuring that the agreement is legally binding and enforceable, and it is the responsibility of the employer to draft and implement the non-compete agreement in a manner that is reasonable and equitable for all parties involved. By doing so, businesses can protect their trade secrets and maintain their competitive advantage without infringing on the rights of former employees.
Determining What is “Reasonable”
One of the biggest challenges for both employers and employees as to non-competes is the fact that it is notoriously difficult to determine whether any given agreement will be ultimately deemed enforceable. There is no statute that governs non-competes; rather, Mississippi courts have set forth broad principles to be applied when evaluating the validity of such agreements. These principles all revolve around the inherently amorphous concept of “reasonableness.”
“The validity and therefore, the enforceability of a non-competition provision is largely predicated upon the reasonableness and specificity of its terms, primarily, the duration of the restriction and its geographic scope.” Empiregas, Inc. of Kosciusko v. Bain, 599 So.2d 971, 975 (Miss.1992).
How far and how long the contract prohibits competition is thus the key to determining reasonableness. Non-competition agreements are valid only “within such territory and during such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.” Id.
To determine what is “reasonably necessary” a court will look to the respective rights of the employer, the employee, and the public. How such an analysis shakes out is not something that can be determined in the abstract. The nature of the business, the nature of the employee’s responsibilities, and other factors will play a role. A two-year time limit or a state-wide restriction may be held enforceable in one case, while a six-month or 20-mile limitation may be deemed enforceable in another.
If your business is considering drafting a non-competition agreement for employees or key members of your team, or if you are facing a challenge to the enforceability of an existing agreement, you should consult with an experienced Mississippi business lawyer who can work with you to ensure that your valuable corporate assets are thoroughly and effectively protected.
Rushing & Guice, P.L.L.C.: Mississippi and Gulf Coast Business Lawyers
At Rushing & Guice, experienced business counsel is a phone call away. Call us at (228) 374-2313 or fill out our online form to arrange for an initial consultation. We look forward to hearing from you and look forward to the opportunity to serve as your attorneys.
This website has been prepared by Rushing & Guice, P.L.L.C. for informational purposes only and does not, and is not intended to, constitute legal advice. The information is not provided in the course of an attorney-client relationship and is not intended to substitute for legal advice from an attorney licensed in your jurisdiction.
