Is non compete enforcible even if not offered employment?

Non-compete sounds like a bad deal

Without doing some additional legal research, I cannot give a definitive answer to this question. I am not aware of any Arizona case that addresses this exact situation. But an application of basic concepts regarding non-compete agreements leads me to believe that this agreement would be difficult to enforce. The purpose of a non-compete agreement is to protect the employer against the loss of business contacts or information that an employee developed during employment that may give an advantage to a competitor. Training a prospective employee in a common skill for the industry does not involve trade secrets, confidential company information or the development of customer contacts that are usually the protectible interests of the employer. Most non-compete agreements must be reasonably restricted as to time and geographic scope. While a countywide limit may be reasonable, the time limit is not supposed to exceed the period of time necessary to hire, train and orient a replacement. If your training only took a few weeks, it seems hard to understand why a six month prohibition would be necessary, especially when you never even went to work for the casino. Another interesting question that arises is where the casino will go to enforce the agreement. Violations of such agreements often result in suits against both the employee, for breach of contract, and the new employer , for interference with contract. The casino could probably file suit against you in Superior Court, but another casino on a different reservation would not necessarily be subject to the state court's jurisdiction for activities it conducts on its own land.
Perhaps the most important practical consideration is whether a prospective employer will be willing to hire you in light of the agreement, whether or not it is enforceable. If you fail to advise the prospective employer about it, you may lose the job as quickly as you land it.
Finally, what will casino 1 be able to do if they take you to court over a violation? Without reading the agreement I can't say for sure, but how could they say they have been damaged, when they never even hired you?
As you can see, non-compete agreements as a rule raise more issues than they resolve. I would suggest having a lawyer review the agreement and discuss the specifics, but don't expect any black and white answers.

posted by Francis Fanning  |  Mar 7, 2003 4:19 PM [EST]