Non compete agreement is an extensively used agreement in the corporate field where competition runs high and the companies are fighting shoulder to shoulder to keep their edge over their competitors.

This type of agreement binds a person or representative temporarily working for a company, to refrain from working against the company or its interest even after the contract between a representative and the company has ended.

Read this detailed article if you have a query related to a non-compete agreement such as where it comes from, what it means, and how it can be applied. The article explains in detail the ins and outs of the non compete agreement and its intricacies as well.

What Is a Non Compete Agreement?

Non compete agreement is an important tool used by the companies to protect their interests against the competition. It is essential for protecting the interests of a company, even when the employee or service provider has completed the terms.

It is basically a pact between a company and a representative where the representative is asked and held liable by law. This guides two parties to not act in a way that is deemed as competitiveness against the company.

Also, it protects the interests of the company from being held in danger by the representative after their term of working with the company is essentially over.

Non compete agreement is used in circumstances after the company and the representative have closed their working contract and their term with it.

In simple words, the representative is asked to refrain from competing against the company after their term of working has come to an end.

Why Employers Use a Non Compete Agreement?

A non compete agreement was prevalent with the representatives who are essentially temporary workers of a company. The purpose of a non-compete agreement is to stop the employees or representatives from trading trade secrets of the company with its competitors.

A representative or employee is usually assigned certain tasks by the company while dealing with certain services or goods of the company. These tasks could include marketing, sales, or storage of the services or goods offered by the company.

In order to help the representative work better, the representatives are often given additional information about the production, price, and other miscellaneous information about the products of the company.

This information is often sensitive and can be used by the competitors to wrongfully take advantage of leading the market. It can become a usual practice for people to get a higher salary, a notable position.

Or other monetary benefits from a competitor’s company by using the information they gain as a representative of a company. This information is essentially used against the said company by joining a competitor in the future.

In order to stop this trading of information between representatives and the companies, such a non compete agreement is put into place. Hence, the agreement works to safeguard the interests of a company.

What Are Included in a Non-Compete Agreement?

The non compete agreement has several aspects that the involved parties must carefully go-through before forming an agreement. The agreement is formed by experts in legal documentation. It is advisable for both parties to keep the following things into consideration:

  • This agreement is directed from one party to the other, mainly from the company to the employee. Most of the time, additional compensation or commission for following this agreement is not involved.
  • This agreement imposes a legal obligation onto the representative that leaves the company, to work forward in his career while adhering to the objectives stated in this agreement.
  • This agreement is recognized in the sight of the law and any party overstepping or not adhering to the agreement will be liable according to the law of the state, or the penalties described within the same agreement.
  • The agreement may seem one-sided at first glance. The representative is asked to adhere to a set of rules without any compensation. However, certain considerations are taken into account to make the agreement agreeable by the representative as well.

Considerations And Obligations for the Employee

Following considerations are kept in perspective for the representative while forming the agreement:

  • The content of the agreement is designed in such a way that the representative is not held back in his career at all and the future business ventures are not narrowed for him.
  • The representative can even be offered some compensation for abiding by the agreement in rare cases.
  • The clauses of non compete agreement is put forth before bringing the representative overboard for work.
  • Agreeing and recognizing the relationship formed by the agreement. Moreover, loyalty and goodwill towards the company shall be kept into view as well.
  • The representative is essentially denied to work in any capacity whatsoever, for the rivals in a way that it is deemed as competing against the subject company.
  • The representative is required by law to carefully analyze the structure of the legal document and agree under law, that it is fairly and rightly set up, and that the rights of the representative are not hurt anywhere whatsoever.

How Can You Get a Free Non-Compete Agreement?

The best place in the market, to acquire a template non compete agreement, is definitely Cocosign. The site offers wonderful legal advice regarding your legal documents, such as the non compete agreement.

Cocosign is an easy-to-use online platform with a wonderful legal consultancy option. It should be your go-to platform for any legal issue that you might encounter in your business documentation. Grab your free non-compete agreement template now!

Don't forget to celebrate your signing experience!

CocoSign, is simply document signing for each business. You could build a stronger relationship and share your experience with each client and partner.


When an employee joins a company, he is often given additional information about the production, price, and other miscellaneous information of the products of the company.

This information is often sensitive and can be used by the competitors to wrongfully take advantage of leading the market. The non-compete agreement is used by corporations in order to bind a representative and safeguard their interests in the future after the working term with a representative is over.


CocoSign represents a wide collection of legal templates covering all types of leases, contracts and agreements for personal and commercial use. All legal templates available on CocoSign shall not be considered as attorney-client advice. Meanwhile, CocoSign shall not be responsible for the examination or evaluation of reviews, recommendations, services, etc. posted by parties other than CocoSign itself on its platform.