Non-compete obligations, also known as competition clauses or restrictive covenants, are employment contracts used by employers to limit an employee`s ability to compete with the employer by stealing customers or trade secrets. Enforceable agreements must balance the protection of the employer`s legitimate business interests against unfair competitive advantage with the employee`s right to work in a field for which he or she is trained. In general, courts decide what is deemed appropriate or inappropriate by considering the nature and size of the business, the duration and geographic area to which the restrictions apply, and whether the employee received a reasonable consideration or benefit at the time the contract was signed. Agreements may be considered unenforceable if a court finds that they are inappropriate in terms of duration, geographical scope and type of employment or restricted industry. If a court finds that an agreement is inappropriate, it may amend the agreement so that it does not unduly affect the former employee`s ability to work. This case offers several important lessons for employers. First, employers should review all solicitation bans to ensure they comply with Oklahoma`s narrow exceptions. If a non-solicitation agreement is not technically compliant with Oklahoma law, there is a high probability that the non-solicitation agreement will be invalid in its entirety, allowing former employees to recruit all customers. It should be noted that TRO prohibited Autry from recruiting employees from a current and specific customer list, but the Court of Appeal overturned this decision because the underlying non-solicitation agreement was too broad. Second, employers should use confidentiality agreements and anti-raid agreements that prohibit former employees from removing former employees.
These are legal in Oklahoma. In addition, they were part of the TRO in the Acosta case, but were not part of the appeal. Third, out-of-state employers with Oklahoma employees should also review their prohibitions on non-competition and solicitation. Many of these agreements include clauses that select another state`s law to circumvent Oklahoma`s narrow exceptions. However, as a result of the Acosta decision, Oklahoma employees may be able to argue that law enforcement in another state violates Oklahoma`s fundamental public order. Therefore, any non-solicitation agreement that does not comply with Oklahoma law is unenforceable. Here are some examples of non-compete obligations that Oklahoma courts have found appropriate: For a term used as often as “non-compete,” I think the details of the agreement and the parameters are not well understood. One way I try to help in this area is to offer a collection of articles titled “Oklahoma Non-Compete Agreements.” You can find an index of the articles below and watch the video above for a brief explanation of the series. […] Is my no-go policy applicable in Oklahoma? The short answer is that if you`re in Oklahoma, the non-compete code is unenforceable. With a few exceptions, Oklahoma law is clear that a person is allowed to work in the company or industry of their choice, even if a piece of paper says otherwise.
While competition is allowed, Oklahoma law prohibits a former employee from recruiting the former employer`s established clients. […] Although the U.S. Supreme Court ultimately overturned the Howard decision because the Oklahoma court failed to comply with the arbitration provision of the agreement in question, uncertainty remained as to the applicability of the anti-raid provisions under Oklahoma law. Oklahoma`s model no-compete agreement can provide some security to a business entity concerned about the potential of a new business relationship by using the information shared incorrectly or maliciously. Now, while this agreement must be presented at the beginning of a business relationship, in this state, the continuation and acceptance of that relationship cannot depend on the performance of that contract. Otherwise, this document is effective in providing legitimate evidence that the recipient has given his or her word, that certain restrictions and concerns expressed by the disclosing company are being respected. A written promise made by the recipient prior to the commencement of its relationship with the Company may be very valuable because the law of the State of Oklahoma does not necessarily permit non-compete obligations unless the recipient is prevented from intentionally and unfairly competing with the Company in a manner that seriously affects its ability to operate. While working at Acosta Foodservice in Oklahoma City, Carrie Autry signed a non-disclosure agreement and a non-solicitation agreement.
Her non-solicitation agreement stated that 12 months after leaving the company, she could not “participate directly or indirectly in the sale, advertising or promotion of the sale of the customers [Autry] represented during her employment with Acosta.” The next task in this article is to use the last two statements to define exactly when the effect of this document will occur. Only one of these statements can be chosen to provide a definitive event that defines these conditions for the recipient. Select the first statement to set the effective date as the date of performance of this Agreement, or select the second statement to name the termination of the recipient`s relationship with the Company as the beginning of the validity period. The Oklahoma Court of Civil Appeals (COCA) set aside the trial court and ruled that an injunction was inappropriate because the non-solicitation agreement violated Oklahoma law and public order. In particular, COCA held that the mere removal of “indirectly” from the non-solicitation agreement rendered the non-solicitation agreement unenforceable. The court held that since the agreement, as drafted, would prohibit Autry from advertising clients with whom it had worked on Acosta, but was not current clients and had not been for some time, it was not limited to preventing the solicitation of “established customers”. Over the past year, I`ve written several articles about non-competition under Oklahoma law. .