Miami, FL commercial litigation attorney Robert Zarco talks about how you can get around a Non-Compete or other restrictive covenants in your franchise agreement. He points out that non-compete agreements are increasingly becoming points of legal contention. Employees working within a franchise who seek opportunities elsewhere may encounter restrictions if bound by a non-compete, particularly those in lower-compensated positions.

For franchisees, the enforceability of a non-compete is strengthened if the franchisor provides consideration or other value in exchange. However, when a franchisee seeks to enter the same industry in a different state or market following termination or the expiration of the franchise agreement, they may challenge the franchisor’s attempt to limit competition.

He notes that the validity of a non-compete is evaluated based on several factors, including clarity, reasonableness in geographic scope, and reasonableness in duration. In general, broader geographic limits and longer timeframes reduce the likelihood of enforceability. These issues require careful analysis and thoughtful consideration to balance the rights of both parties.