Noncompete clause definition

A non-compete clause is contractual language where a party (usually an employee) agrees not to compete with another party (usually an employer) under specific conditions. A noncompete agreement may be part of a larger contract or the intention of an entire agreement.

The rule-of-thumb in successfully enforcing a noncompete agreement or clause is that restrictions should be reasonable with regard to two primary elements: geographical area and the time period.

Such covenants are also used in other relationships where parties may collaborate for a limited time.

Consult with an attorney before issuing or signing any noncompete clause.