Perhaps you’ve never had to sign a non-compete agreement with an employer. Basically, a non-compete clause in a contract requires that you agree not to work for yourself or another employer in a manner that competes with your former employer.

For instance, most TV stations insist that their local newscasters sign a non-compete agreement stating they will not go to work on air for one of the competing stations. Generally, the specific employment and the geographical area to be restricted are spelled out.

Non-compete agreements are all about fairness and protection of trade secrets. It’s easy to see that it would be unfair for an employee of an insurance company to take a list of current policy holders to a competing insurance company down the street, then contact those customers offering similar policies at 10% less than they paid to the first company. Or an employee of a food manufacturer may steal a secret recipe and sell it to the highest bidder. It is reasonable for an employer to seek to prevent such situations.

But non-compete agreements must also be fair to the employee. Overly restrictive agreements can basically keep the person from making a living without taking up a different line of employment, or moving out of the area.

Everyone agrees that the Idaho Association of Commerce and Industry (IACI) is tardy in getting a bill strengthening non-compete agreements into the legislature. However, IACI did just that last week, with SB 1203. IACI feels a 2005 Idaho Supreme Court case weakened the agreements in the state.

The Idaho Supreme Court case in question dealt with an ophthalmologist who was employed by an eye care chain. His contract included a non-compete clause but there was disagreement over exactly when non-compete time period began, and a cash payment to “purchase the practice”. Apparently, IACI feels the ruling hurt employers.

It is very interesting that senators from both the left and the right were on both sides of this legislation. A perusal of today’s Senate Journal reveals that Senators Richardson, Siddoway and McKague, usually regarded as staunch conservatives, voted in favor of SB 1203.

Opposing the bill were conservative Senators Fulcher and Pearce. Perhaps research into the livelihoods of senators on both sides of the issue (outside of the legislature, of course) would reveal their motivations. (However, I don’t have a copy of the Idaho Blue Book, and very little information contained therein is available on line.)

I believe that reasonable non-compete agreements should be allowed. However, employer desires must be balanced against employee needs. I commend the Idaho Senate for voting down this restrictive last-minute legislation.

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