An employee who is already on the payroll may be more reluctant to sign anythingand you'll have less leverage to negotiate the agreement. Battles over the legality of these agreements must usually be resolved in court. Judges are reluctant to deprive people of their rights to earn a living, so the key to a legally enforceable covenant not to compete is to make its terms reasonable. Focus on three questions. There probably is if you expect to spend significant time and money training a high-level employee and plan to trust him or her with sensitive contacts on lucrative accounts.
Courts tend to favor short covenantsthe shorter the better.
A one-year covenant may be reasonable for a particular employee. A three-year limit might not be. For a local business, a 50-mile limit or one that excludes competition in a few counties may be reasonable. For a regional business, a limit spanning several states may be deemed reasonable. When Mary hires Sid to be the office manager for her profitable travel agency, she realizes that Sid will have access to major corporate accounts and daily contact with the corporate managers who make travel arrangements.