non-compete agreement

Definition

A contract restricting employees from joining competitors or starting competing businesses for a specified period after leaving. Increasingly unenforceable legally but still used to intimidate departing employees.

Example Usage

My non-compete agreement claims I can't work in my industry for two years in a 500-mile radius, which would be enforceable if it weren't ridiculously overbroad and likely illegal.

Origin

Emerged from medieval guild restrictions, formalized in modern employment law in the early 20th century

Fun Fact

California outright bans non-competes except in very limited circumstances, which many credit for Silicon Valley's innovation success—talent can freely move between companies, spreading ideas.

Source: Employment law and restrictive covenant practices

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