Question

"When Sheyla was hired as a sales representative by Computronix, she signed an employment agreement which contained the following provision: ""I, Sheyla, will not solicit business from the customers that I worked with at Computronix for a period of one year following my termination of employment with Computronix." This is an example of a non-compete agreement, which is generally only enforceable if necessary to protect:

a) trade secrets, confidential information, or customer lists developed over an extended period.

b) unacceptable risks because of their speculative nature.

c) the revenue of the state.

d) some underlying principle.

Answer 1

A non-compete agreement, like the one in Sheyla's employment contract, is designed to protect an employer's trade secrets, confidential information, and customer relationships from competition by former employees.

Step-by-step explanation:

The provision in Sheyla's employment agreement with Computronix is an example of a non-compete agreement, which is commonly included in employment contracts to prevent employees from competing with their former employers for a specified period after termination. These agreements are generally only enforceable if necessary to protect trade secrets, confidential information, or customer lists that have been developed over an extended period. The intention behind such legal restrictions is to ensure that companies can safeguard their proprietary information and maintain their competitive advantage without unfair competition from former employees who have had access to sensitive data.

In comparison to exclusive dealing agreements in commerce, which can be legal if they encourage competition but illegal if they limit competition in an anticompetitive manner, non-compete clauses in employment contracts have a different focus. They are designed to protect an employer's legitimate business interests rather than to structure competition between retailers or dealers.