Human Resource Blog

Non-Compete clause in contract

Hi - I am an HR pro living in Colorado. I have no idea how to respond to this email, from a friend. Help!: Her husband is in radio and was recently budget cut from his station. He is under contract and being paid until Feb. 4th. He is not to take another job until his contract is up, otherwise forfeiting his remaining pay. One issue that has recently come up is the 90 day no-compete clause in his contract that states for 90 days after his contract is done, he cannot work within a 60 mile radius of the Denver Metro area. His old boss told my husband when he was let go that he wouldn’t hold him to the 90 day no-compete. My husband recently had an interview with another radio company here in Denver, but the new company wants something in writing from the old General Manager stating that they were not going to hold my husband to the no-compete. His old GM is now back peddling and wants to pick and choose which stations my husand can be interviewed for, none of which are in direct competition with the station he was let go from. With Colorado being a right to work state, can the GM keep my husband from interviewing and accepting a job in Denver after his contract is up on Feb. 4th? Thanks for your advice.

We would love to help, but your friends husband probably needs a lawyer. A non-compete clause is part of a contract. Anytime you have signed a contract and want out of it, that is a good time to consult a lawyer.

Non-compete agreements are very common in the entertainment industry. Recently, some employers have tried to use them for employees in all industries — even parking lot attendants. Across the nation, many courts have found that non-compete clauses unfairly limit the employees ability to earn a living. In some cases, they have also ruled that the employer is exerting unfair pressure on employees to sign the agreements. In other cases, the non-compete clause can only be enforced while the employee is being paid at least half salary. However, the courts have in some cases upheld non-compete clauses in the broadcast industry. And a 90-day noncompete agreement is actually a rather short one — some employers try to enforce a non-compete agreement of 2 to 5 years. Much will depend upon the exact wording of this agreement.

Colorado is a right to work state, and that has absolutely no bearing on this issue. Right to work simply means that an employee cannot be forced to join a union, in order to secure a job.