NON-COMPETITION AGREEMENTS

In Oregon, a non-competition agreement between employer and employee (restricting an employee from working for a competitor after the employment terminates) must meet certain statutory requirements for it to be enforceable. Key parts of the statute include:

• “Nonexempt” employees (primarily hourly and nonsupervisory employees) cannot be subject to non-compete agreements
• An employer must inform a potential employee in writing about a non-compete agreement at least two weeks before the first day of work
• A non-compete agreement is unenforceable unless the employer has a “protectable” interest, such as access to trade secrets
• A non-compete agreement cannot be enforced against an employee whose total gross salary is less than that of the median income of a family of four in Oregon (currently about $61,000 a year)
• A non-competition agreement cannot last longer than two years

Although non-compete agreements are now more strictly interpreted and more difficult to enforce, it is easier for employers to enforce non-solicit agreements. A non-solicit agreement is like a non-compete agreement however, it is a more limited. It does not restrict an employee from working for a competitor altogether. It merely restricts an employee from soliciting the customers and other employees of the employer to leave or do business elsewhere.

A non-solicit agreement will be enforceable regardless of when an employee signs it. The law states that the restrictions in Oregon’s non-compete law no longer apply to “[a] covenant not to solicit employees of the employer or solicit or transact business with customers of the employer.” Oregon employers can require their existing employees to sign non-solicit agreements, regardless of whether they put the employee on notice of such a requirement before they start their employment.

If you wish to prevent a key employee from competing with your business after termination or you want to prevent an employee from soliciting customers or other employees, Levinson Law can help.