Tip: Make Noncompete Clauses Clear and Specific - Modern Distribution Management

Log In

Tip: Make Noncompete Clauses Clear and Specific

Restrictive agreements that are too broad may not hold up in court.

Restrictive clauses for employees, whether as a nondisclosure agreement or full-blown noncompete, should be narrowly tailored to improve enforceability and compliance, says Michael Greco, a partner with labor law firm Fisher & Phillips, in The Challenge of Noncompetes.

According to Greco, many cases favor the employee rather than the employer because the restrictive clauses are just too broad or unclear. "You should be able to stand up and tell a judge ‘We were really careful and thoughtful about this so as to not overreach,’” he says.

Although there is no such thing as an ironclad noncompete, making the provisions specific and clear can help the agreement stand up in court, says Greco.

Identifying which competitors are covered by the agreement is one way to make it clear to employees how the agreement will limit them, says Skip DeVilling, president of DeVilling & Associates LLC, a recruiting firm focused on industrial and construction markets. 

DeVilling also says it is important to clearly define restrictions on geography or industry since most U.S. juries wouldn't side with a company that is trying to force someone out of their industry altogether.

Read more about the best practices, as well as the pitfalls, of restrictive clauses in The Challenge of Noncompetes.

Share this article

About the Author
Recommended Reading
Leave a Reply

Leave a Comment

Sign Up for the MDM Update Newsletter

The MDM update newsletter is your best source for news and trends in the wholesale distribution industry.

Get the MDM Update Newsletter

Wholesale distribution news and trends delivered right to your inbox.

Sign-up for our free newsletter and get:

  • Up-to-date news in a quick-to-read format
  • Free access to webcasts, podcasts and live events
  • Exclusive whitepapers, research and reports
  • And more!


articles left

Want more Premium content from MDM?

Subscribe today and get:

  • New issues twice each month
  • Unlimited access to mdm.com, including 10+ years of archived data
  • Current trends analysis, market data and economic updates
  • Discounts on select store products and events

Subscribe to continue reading

MDM Premium Subscribers get:

  • Unlimited access to MDM.com
  • 1 year digital subscription, with new issues twice a month
  • Trends analysis, market data and quarterly economic updates
  • Deals on select store products and events



You have one free article remaining

Subscribe to MDM Premium to get unlimited access. Your subscription includes:

  • Two new issues a month
  • Access to 10+ years of archived data on mdm.com
  • Quarterly economic updates, trends analysis and market data
  • Store and event discounts

To continue reading, you must be an MDM Premium subscriber.

Join other distribution executives who use MDM Premium to optimize their business. Our insights and analysis help you enter the right new markets, turbocharge your sales and marketing efforts, identify business partners that help you scale, and stay ahead of your competitors.

Register for full access

By providing your email, you agree to receive announcements from us and our partners for our newsletter, events, surveys, and partner resources per MDM Terms & Conditions. You can withdraw consent at any time.

Learn More about Custom Reports

Request a Market Prospector Demo

  • This field is for validation purposes and should be left unchanged.