Are Non Compete Agreements Valid In Missouri

A recent Federal Court decision in Missouri highlights the difficulty of enforcing these agreements against Missouri employees. (Durrell v. Tech Electronics, Inc., 4:16-cv-1367-cdp (November 15)). It goes without saying that such restrictions can only be applied if the employee agrees to be bound to them. As a general rule, a staff member states that he or she is prepared to be bound by such restrictions by signing a non-compete agreement when the employee is recruited. Signing a non-competition agreement is usually a prerequisite for hiring. If the employee does not sign the non-competition agreement, the employer does not hire the employee. A non-compete agreement preventing a worker from competing with his “business,” defined in the agreement as the sale of cleaning products, would not be particularly effective if the employer subsequently develops into the main sale of office supplies and the worker leaves the company to work for a competitor in office supplies. Non-competitive agreements in Missouri are enforceable if they are reasonable and necessary to protect the legitimate interests of an employer.

Two decisions by Missouri courts to enforce anti-competitive agreements show how to make restrictions on the competitiveness of young workers with their former employer. One thing is certain: Missouri employers will want to make their arbitration agreements and non-competition obligations with the utmost care. Otherwise, they risk signing a contract that will be broken. Non-competition obligations are governed by state law, usually in interpretation by the courts and sometimes codified by law. In the absence of a non-competition agreement, some states impose limited restrictions on workers, but non-competition agreements generally provide much greater protection for employers. Under certain circumstances, an employee who works with clients across the country could prevent the recruitment of clients from anywhere in the United States. Similarly, a restriction may apply to one or more states. A Missouri court has the power to limit the territorial scope of such a restriction if the court finds that the restriction in the Missouri non-compete agreement is too broad. Durrell`s employer may not be lucky yet.

The court did not rule that the non-compete clause was invalid. The former employees challenged the applicability of the Missouri clause of choice and argued that Oklahoma law must apply when disclosing the agreements. They argued that Oklahoma, as Oklahoma residents who worked for TLC in Oklahoma, was much more interested in the outcome of the litigation. The Bundesgerichtshof rejected this argument because each state had a vital interest in the validity of the agreements and there was no evidence that Oklahoma had a much greater interest in the case. Therefore, the court applied Missouri law to the case. Because the restrictions imposed by Missouri law were reasonable, the court asked the former employee to continue operating centers in Tulsa and Oklahoma City and to seek sources of dismissal.

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