We recently were again approached by potential clients concerning a review of non- competition and non-solicitation covenants contained within employment agreements. We often receive these types of inquiries, both on behalf of employees and businesses. In fact, Tom Blackwell, a shareholder in Hopper Blackwell, P.C., handled one of the more well known non- compete cases in the State of Indiana. [Dicen v. New Sesco, 839 N.E.2d 684].
While any detailed analysis of the law surrounding non-compete and non-solicitation agreements is too broad of a topic for any one post, we have written about some of those issues before. However, what became apparent from the agreements that we were asked to look at last week is that certain employers are having all of their employees, regardless of the employee’s role at the business, sign the same form non-compete/non-solicitation agreement. The problem becomes that certain language that may be applicable to certain employees would not be applicable to others. For example, language that makes sense for a sales person may not make any sense for an engineer or executive.
Indiana law is clear that non-compete and non-solicitation agreements are disfavored by the law, which means that courts will look for any opportunity to not enforce them. Furthermore, a court will not rewrite your agreement. With some simple editing, non-compete agreements can be drafted to fit the particular situation and individual, and thereby greatly increase the probability that the court will enforce that agreement and protect the employer’s interest. Conversely, if the employer chooses not to tailor the agreements to fit the particular individual situation, the employer must understand that courts will interpret any ambiguity in the agreement against the employer (because the employer drafted the agreement), and therefore in situations where language is left in an agreement that, under the circumstances, “does not make any sense,” a court is far less likely to enforce that agreement on behalf of the employer.
It is a good practice for businesses to review and, if necessary, revise employment agreements and related non-compete and non-solicitation covenants so as to increase the likelihood that they will be enforced by Indiana courts because when it comes to these types of agreements, one size does not fit all.
