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What Is Business Law?

Business law can be puzzling to many new business owners. But put simply, business law is the combination of statutes and court rulings that govern everything that concerns your business operations. It includes two aspects: the administration of commercial entities and the legislation of business contracts. Over time, laws have changed and have to adjust to the progress of technology, industry regulations, and the ever-evolving demands of society. In this article, we will review the importance and role of business law in regulating entrepreneurial activities and making sure the business owner and their clients are both protected.

Why Is It Important?

Business law governs how corporations are managed by the state, the contracts between business owners and investors, and the contracts that govern business relationships. In my experience, one of the most costly mistakes business owners make is not having the proper business agreements between business owners. When conflicts arise, the business owners end up in a lawsuit costing tens, if not hundreds, of thousands of dollars. In addition, the business itself is often forced to dissolve not only because of the high legal bills, but because the business owners failed to agree on certain fundamentals of the business. Another costly mistake is not having the proper business-to-business (B2B) contracts. The problem is the same as above-- the businesses will end up in a dispute and not before long, are suing and incurring legal bills and having their business operations compromised. Believe me when I say, as a business ...
We’ve often been asked. What matters more—a former employer’s intellectual property and business assets or an ex-employee’s right to fair future employment opportunities? Such a question often arises when we encounter employment breakups. And such endings can hurt, especially if non-compete agreements are involved. Fortunately, the more recent reforms to state laws have taken a closer look at the welfare of both parties when it comes to imposing non-competes. In this article, we seek to explore what non-compete agreements are, their pros and cons on both sides (employers and employees), and how some newer state laws have embraced a few, more promising changes to how non-compete clauses should work.

What Is a Non-Compete Agreement?

A non-compete agreement is a formal and legal agreement between an employee and an employer. It enforces a restriction on the employee, making them promise not to “compete” with the employer after the employment period is over. Under a non-compete contract, a former employee could be restricted from working under the former employer’s competitor for a specific period. The former employee could also be prohibited from becoming a direct business competitor. This agreement helps protect the employee’s intellectual property, including customer or client lists, best business practices, trade secrets, and marketing plans. Noncompete agreements can also be in the form of noncompete clauses and may also be known as non-compete covenants.

Understanding How It Works

Non-competes are signed when the employer-employee relationship begins. The contract terms may include the geographic location, market, and length of ...
Many employers will ask all of their new employees to sign a non-compete agreement. These contracts seek to limit any competition the employer will likely face from any previous employees who have intimate knowledge of how their business operates, and as a result, are in a great position to steal customers, clients, and even other employees. So, it's easy to see why businesses want employees to sign them. However, a non-compete agreement can also give the employer permission to control their former employees long after they have left the business. This violates people's rights to make a living and goes against our country's honored traditions of free enterprise. For this reason, some states don't allow a business to ask their employees to sign non-compete agreements at all. Those states that do allow them will not enforce a non-compete clause that lasts for an extended period of time. They also will not allow an agreement that covers a large territory or one that places too many restrictions on an employee's right to seek better opportunities within their chosen profession in the future. At Shakfeh Law LLC, we support both employers and employees in legal cases involving non-compete agreements, so click here to contact us or call us at (630) 517-5529.

What Is A Non-Compete Clause (NCC)?

For Employers

Employers will ask their employees to sign non-compete clauses in an attempt to mitigate the risk of entrusting them with confidential and valuable material. They are frequently used when consultants and ...
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