Creating Enforceable Employment Agreements for Your New Business

 Posted on November 17, 2017 in Business Law

Starting a new business is an exciting time for everyone involved, especially for the business owners once they see their plans come to fruition. However, the myriad of details that require attention when starting a new business can be overwhelming, and there are many complex issues that a business owner will need to deal with, from financial arrangements and tax issues to decisions about property.

One area that should not be overlooked when starting a new business is employment law. Employers will need to be sure that they are abiding by the law in any employment contracts and that the terms of their employment agreements are enforceable.

Employment Agreements in Wisconsin

• Wisconsin is an “employment-at-will” state — there is an implied contract in which employers or employees are both free to terminate employment at any time and for any reason that is not illegal (such as discrimination). However, employers may also use contracts that include additional terms, such as:
• Non-compete agreements - A contract may restrict an employee from competing with his or her employer while employed or after termination. To be enforceable, a non-compete agreement must be reasonably necessary to protect the employer’s interests. It must only restrict employees for a reasonable time period and in a reasonable zone or geographic area. Furthermore, it must not restrict an employee’s ability to earn a living, and it must not be against public policy.
• Non-solicitation agreements - A contract may restrict an employee from doing business with an employer’s employees or customers after the employee’s termination. As with non-compete agreements, the terms of these agreements must be reasonable and not overly broad.
• Confidentiality agreements - A contract may restrict employees from disclosing sensitive information about a business after their termination. To be enforceable, confidentiality agreements must not cover information that is generally known to the public or was already known or developed by an employee prior to their employment. They must include time limits, and, if necessary, geographical scope.
• Invention and patent agreements - A contract may include terms that assign some or all of the rights to any patentable inventions to the employer if an employee develops them while working for the employer. To be enforceable, the terms of this type of agreement must not be overly broad.

Contact a Wisconsin Employment Lawyer

If you are starting a new business, the skilled attorneys at Gimbel, Reilly, Guerin & Brown, LLP can help you make sure the employment agreements you use meet the requirements of Wisconsin law while providing you with the protections you need. Contact a Milwaukee employment attorney today at 414-271-1440.

Sources:

https://docs.legis.wisconsin.gov/statutes/statutes/103/465

http://www.wisbar.org/NewsPublications/WisconsinLawyer/Pages/Article.aspx?Volume=86&Issue=4&ArticleID=10765