Are non-competes enforceable in my state?

Enforceability depends on state law; courts evaluate duration, geography, activity scope, and whether adequate consideration was provided. Some jurisdictions, notably California, restrict or void most non-competes. Consult counsel to tailor terms to applicable statutes and case law before relying on enforcement.

Can employees sign these agreements electronically?

Yes. Electronic signatures satisfy the ESIGN Act and UETA where intent, consent, attribution, and record retention are present. For consumer-facing or healthcare contexts, provide any required consumer disclosures and obtain explicit consent when applicable to ensure admissibility.

What kind of consideration is required?

Consideration may be initial employment, continued employment, a promotion, a signing bonus, or severance. Some states require fresh consideration for post-termination covenants; clearly documenting the benefit and timing strengthens enforceability and reduces dispute risk.

How long can a covenant reasonably last?

Courts assess reasonableness based on role, industry, and geography. Common post-employment durations range from six to twenty-four months; covenants longer than that face increased scrutiny and may be narrowed or invalidated.

Can the agreement be amended after signing?

Amendments should be in writing and signed by all parties. Unilateral changes risk invalidation. Document any new consideration tied to amendments to preserve enforceability for added restrictions.

When should the agreement be notarized or witnessed?

Most employment covenants do not require notarization, but notarized acknowledgements or remote online notarization can add evidentiary value in disputes where allowed. Follow state RON and notary rules when notarization is chosen.

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Employment Agreement with Covenant Not to Compete

Employment Agreement with Covenant Not to Compete

This template is fully customizable. Edit the text, fill out the fields, and send it for signature. Give it a try!

What an Employment Agreement with Covenant Not to Compete Is

An Employment Agreement with Covenant Not to Compete is a written contract between employer and employee that sets employment terms and includes a restrictive covenant limiting post‑employment competition, solicitation, or use of confidential information. Typical provisions define scope of restricted activities, geographic boundaries, duration, consideration, remedies for breach, and severability. Enforceability depends on state law reasonableness standards; employers commonly pair covenants with confidentiality, assignment of inventions, and non‑solicit clauses to protect trade secrets and client relationships.

Why the Agreement Matters for Employers and Employees

Use this agreement to protect legitimate business interests such as confidential information, customer relationships, and goodwill while setting clear post‑employment limits. Properly drafted covenants balance employer protection and employee mobility and reduce the likelihood of costly disputes under ESIGN, UETA, and applicable state contract law.

Who Typically Uses This Agreement and How It Helps

Employers, HR professionals, in-house counsel, and recruitment teams use this agreement when hiring for sensitive or strategic roles.

Small and mid-size companies: protect client lists and trade secrets with tailored geographic and temporal limits.
Startups and tech firms: combine IP assignment with covenants to preserve investor value and product advantage.
Professional services: safeguard client relationships and non-solicitation provisions for fee-generating partners and staff.

Who Signs and Who Approves

HR Director

HR directors and general counsel typically authorize the agreement, ensuring it includes lawful scope, adequate consideration, and a severability clause. They work with hiring managers to calibrate duration and geographic limits so the covenant is defensible if challenged in court.

New Hire

Employees should review terms before acceptance, consider negotiation of duration or compensation, and obtain independent counsel when appropriate. A signed agreement may affect future employment options and requires accurate personal and employment data to avoid disputes.

Essential Information to Include in the Agreement

Employee Name: Full legal name as on ID

Position Title: Job title and department

Start Date: Enter as MM/DD/YYYY format

Compensation: Base salary and bonus structure

Covenant Term: Duration and geographic scope

Consideration: Specify salary, bonus, or benefit

Short-Form Risks to Watch For

Unenforceability: Court may refuse enforcement

Litigation Costs: Expensive defense and damages

Injunctive Relief: Immediate court orders possible

Employee Turnover: Harder to recruit talent

Statutory Limits: State law may bar covenants

Wrongful Drafting: Overbroad terms risk invalidation

Common Preparation Mistakes to Avoid

Failing to specify geographic scope and business activities precisely, leaving courts to interpret breadth and potentially voiding the covenant for being overbroad.
Not offering adequate consideration, such as a promotion, bonus, or continued employment, which may render a post-employment restriction unenforceable.
Using a one-size-fits-all covenant across roles with different seniority or access levels instead of tailoring limits to protect legitimate interests.
Failing to account for state-specific prohibitions or limits, particularly in California and other jurisdictions that restrict non-compete enforceability.

How Organizations Use These Agreements in Practice

Real-world examples show how employers use an Employment Agreement with Covenant Not to Compete to protect customer relationships, IP, and business goodwill while enabling remote signature workflows.

Martin Properties

Martin Properties used Employment Agreements with covenants to protect leasing client lists and ensure former agents do not compete locally after separation.

They used secure e-sign workflows to speed execution.
Tim Martin said their team processes and executes agreements online with compliance and built-in security; mobile signing and offline options helped finalize covenants quickly across remote properties. This reduced turnaround time for hiring and contract enforcement.

Optica Ventures

Optica Ventures implemented signed covenants for investment team hires to protect deal flow and proprietary diligence materials during and after employment.

They prioritized ease of signing for external parties.
Brian Fitzgibbons said the interface is simple and easy-to-use for the team and customers; that ease increased completion rates and cut administrative follow-ups for covenant signatures. This helped maintain investor confidentiality and speed hiring decisions across portfolio companies.

Step-by-Step: Complete and Execute the Agreement

[INTRO] Use the following sequential process to populate, review, execute, and retain an Employment Agreement with Covenant Not to Compete using electronic signing.

01

Prepare Draft: Insert parties, duties, and covenant terms.
02

Review Legality: Check state enforceability and reasonableness.
03

Obtain Consideration: Document monetary or employment consideration provided.
04

Execute Securely: Use vetted e-sign with audit trail.

How Online Signing and Routing Works

This section outlines the digital signing flow for executing an Employment Agreement with Covenant Not to Compete from upload through completion and retention.

Upload Document: Upload final draft to signing platform.
Place Fields: Add signature, date, and initial fields.
Authenticate Signer: Choose email, SMS, or KBA verification.
Complete & Store: Signed copies and audit trail archived securely.

Key Contract Sections to Draft Carefully

Core sections of an Employment Agreement with Covenant Not to Compete define parties, term, restrictive covenants, consideration, remedies, and ancillary protections such as confidentiality and IP assignment.

Parties

Identify employer and employee as legal entities, include business address, and specify whether the employee is an individual or contractor; correct identification prevents future disputes over party obligations and enforceability.

Term

Specify the effective date and whether the covenant survives termination; state precise post-termination durations and applicable triggering events to support reasonableness findings.

Covenant Scope

Define prohibited activities, customer and supplier categories, and geographic boundaries. Narrow, role-specific restrictions increase enforceability and reduce the risk of being struck down as overbroad.

Consideration

Record the specific benefit provided—initial employment, promotion, bonus, or severance. Clear documentation of consideration strengthens the employer’s position if challenged.

Remedies

Describe available remedies for breach, including injunctive relief, damages, and recovery of costs; state whether equitable relief is sought to expedite enforcement.

Severability

Include a severability clause permitting courts to reform or narrow overbroad provisions rather than invalidating the entire agreement, which aids enforceability.

Configure a Digital Workflow for Signing and Retention

Configure your digital workflow to collect signatures, authenticate signers, and route executed Employment Agreements to HR and legal for secure retention.

Field	Configuration
Signature Authentication	Email link and optional SMS code
Expiration	Set 30-day auto-expire for signing links
Reminder Schedule	Automated reminders at three and seven days
Routing	Send to HR then legal in order

Technical Requirements and Integration Considerations

Ensure signers have a modern browser or mobile device; plan for PDF/DOCX support and any integration needs.

File Formats: PDF, DOCX, HTML, Excel supported
Integrations: Salesforce, NetSuite, Microsoft 365, Google Workspace
Authentication: Email link, SMS code, SSO options

Timelines, Deadlines, and Processing Expectations

Important timeframes include agreement delivery, employee review period, signature deadlines, any post-termination restricted period, and retention obligations.

Offer and Delivery Timing:

Provide agreement with offer or before start date

Review Period Recommended:

Allow seven to fourteen days for review

Signature Deadline:

Set clear deadline, often before employment begins

Post-Term Restriction Length:

Typical durations range from six to twenty-four months

Record Retention Obligations:

Keep executed copies per regulatory schedule

eSignature Pricing and Feature Comparison (signNow first)

Comparison of typical eSignature vendor pricing and core features relevant to executing Employment Agreements with covenants; signNow appears first per vendor ordering rules.

	signNow	DocuSign	Adobe Sign	PandaDoc	HelloSign
Starting Price	$8/user/mo	$15/user/mo	$14/user/mo	$19/user/mo	$15/user/mo
Free Trial	7-day free trial	Varies by plan	Varies by plan	Varies by plan	Varies by plan
Bulk Send	Yes	Yes	Yes	Yes	No
Audit Trail	Yes	Yes	Yes	Yes	Yes
HIPAA Compliant	Yes	Yes	Yes	No	No
Envelope Cap	No envelope cap	100 envelopes/user/year	Varies by plan	Varies by plan	Varies by plan

Frequently Asked Questions About Non-Compete Agreements

Answers to common legal and execution questions about Employment Agreements with Covenants Not to Compete, including enforceability, e-signature validity, and amendment procedures.

Need help? Contact support

Are non-competes enforceable in my state?
Enforceability depends on state law; courts evaluate duration, geography, activity scope, and whether adequate consideration was provided. Some jurisdictions, notably California, restrict or void most non-competes. Consult counsel to tailor terms to applicable statutes and case law before relying on enforcement.
Can employees sign these agreements electronically?
Yes. Electronic signatures satisfy the ESIGN Act and UETA where intent, consent, attribution, and record retention are present. For consumer-facing or healthcare contexts, provide any required consumer disclosures and obtain explicit consent when applicable to ensure admissibility.
What kind of consideration is required?
Consideration may be initial employment, continued employment, a promotion, a signing bonus, or severance. Some states require fresh consideration for post-termination covenants; clearly documenting the benefit and timing strengthens enforceability and reduces dispute risk.
How long can a covenant reasonably last?
Courts assess reasonableness based on role, industry, and geography. Common post-employment durations range from six to twenty-four months; covenants longer than that face increased scrutiny and may be narrowed or invalidated.
Can the agreement be amended after signing?
Amendments should be in writing and signed by all parties. Unilateral changes risk invalidation. Document any new consideration tied to amendments to preserve enforceability for added restrictions.
When should the agreement be notarized or witnessed?
Most employment covenants do not require notarization, but notarized acknowledgements or remote online notarization can add evidentiary value in disputes where allowed. Follow state RON and notary rules when notarization is chosen.

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