One of the most significant expenses you have as a business owner is finding and training new employees. It often seems that the ones who have the most promise are the ones who move on to different opportunities.
Your employees are part of what makes your business valuable. When you lose a good employee to a competitor, it can have a significant impact. Often, a non-compete can limit where an employee can work, but not all non-compete agreements are enforceable.
Here’s what you should know about non-compete agreements in Oklahoma and when they are allowed.
Only some circumstances
While many states allow non-competes, but with limitations, Oklahoma bans non-compete agreements in all but two situations:
- A business sale that includes goodwill. There can be a non-compete between the buyer and the seller when the seller includes the intangible positive reputation of the business.
- A broken partnership. When business partners part ways, there can be an enforceable non-compete to limit where they can set up competing businesses.
These limitations allow non-competes in specific circumstances and between parties who fully understand the agreement.
What’s so bad about non-competes?
While a non-compete can help you protect your business, it can create challenges for employees. In many cases, employees do not completely understand the potential consequences of a non-compete until it is too late.
Although you may not be able to enforce a non-compete agreement with your employees, a non-disclosure agreement can help you protect the information that makes your business successful.