Loudoun Covenant Not-to-Compete

Loudoun covenant not-to-compete agreements, like similar agreements elsewhere in the Commonwealth, are permissible but not favored agreements in the Commonwealth of Virginia. From the business owner’s perspective, a covenant not-to-compete can be an invaluable tool to protect the significant investment that the business owner makes in his or her employees. Often a business owner will expend significant assets in a new employee before the business owner sees a return on that investment. Without the protection of a covenant not-to-compete, a business owner very well make the decision to not risk the investment in a new employee and not expand his or her business. In this way, a covenant not-to-compete can actually create a job that otherwise would not exist, help stimulate business growth, and provide technical training to a person that would otherwise not receive it or receive it at a much higher cost. Courts will not, however enforce these agreements if they are overly broad and restrictive. Businesses can and often do exceed what is legally permissible when they draft covenants not-to-compete as part of an employment contract. An employer has some right to protect his or her investment, within reason, but not the absolute right to restrict the future livelihood of his or her employees.

These particular types of contracts are uniquely complex because they are not always enforceable. What determines whether the contracts are enforceable is very dependent on the particular facts of each case and contract. At Beckman Schmalzle Georgelas & Ross PLC, we can help you enforce your covenant not-to-compete if an employee has left your business and is in violation and we can help you if you are being sued for violating an unreasonable contract. We can also help you draft a covenant not-to-compete if you considering using one in your contract.

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