Non-Competition Agreements in Kansas

Non-competition agreements, also known as covenants not to compete or restrictive covenants, are employment contracts used by employers to limit the ability of an employee to compete with the employer by stealing customers or trade secrets. Enforceable agreements must strike a balance between protecting the employer's legitimate business interests from an unfair competitive advantage with the employee's right to work in a field for which he or she is trained.  In general, courts decide what is considered reasonable or not reasonable by examining the type and size of the business, how long and over what geographic area the restrictions apply and whether adequate consideration, or benefit, was given the employee at the time the agreement was signed.

The Law In Kansas

Kansas courts have determined that restrictive covenants are enforceable if the terms are reasonable and necessary to protect a legitimate business interest of the employer such as customer relationships or trade secrets. Factors considered when determining reasonableness include the hardship an agreement puts on the former employee, its effect on the general public and the restrictions placed on time, territory and activity of the former employee.

Consideration

With any contractual arrangement, both parties must be giving and receiving something of value, also known as consideration. Kansas courts have determined that the offer of initial or continued employment is sufficient consideration or benefit to the employee in exchange for agreeing to not compete with the employer should the employment relationship terminate.

Reasonableness in Time and Geographic Scope

Agreements may be deemed unenforceable if a court finds that they are unreasonable in terms of duration, geographic scope and the type of employment or line of business being restricted. If a court finds an agreement is unreasonable, it may modify the agreement so that it does not unduly infringe on the former employee's ability to work.

Examples of non-compete agreements that Kansas courts have found to be reasonable include:

  • A 3-year, 1-county restriction against 13 physicians from competing with their former clinic employer.
  • A 2-year restriction against a licensed practical nurse from providing services to patients they had served while under contract with the former employer.
  • A 5-year requirement that the former chairman and CEO of a professional accounting firm pay a declining percentage of fees received from clients of the firm within a 35-mile radius of the cities where the former employer maintained offices.
  • A 1-year restriction against a former wholesale liquor salesperson where the court modified the geographic area to only include the counties where the salesperson actually serviced customers.

The courts have found the following restrictive covenants unreasonable:

  • A 6-month restriction against a supervisor from negotiating for or accepting a position with any client or center of influence of the former employer and its affiliated companies.
  • A 2-year, 25-mile restriction against a colorectal surgeon from competing with his former employer clinic.
  • A 5-year restriction against a federal income tax preparation franchisee with no geographic limitation.

Employers need to keep these issues in mind when asking employees to sign restrictive covenants. It is also important to know if potential new hires have a non-compete agreement with a former employer. In some cases, the new employer can be liable to the former employer if hiring the employee would put him or her in violation of the agreement. Different rules may apply to situations in which all or part of a business is being sold and a restrictive covenant is agreed to by the buyer and the seller.

Questions & Answers: Non-Competition Agreements in Kansas

I have a non-compete that was signed ~13.5yrs ago (no duration on non-compete) with a KS company. I left the company 9 yrs ago. I have identified and work with a new company (wit...
I signed a non compete after I had taken a job with my company, when I was taking over a management position in a facility I transferred to. I got about a 1.75% raise. I was told b...
My travel agency, in Kansas, was reacently bought by a company out of New York. The new owner wants everyone to sign a non-compete agreement that prohibits us from working in the ...
From my understanding, in the state of Kansas, there has to be a duration and geographical area to make a non compete valid and enforceable. Doug ~ you would have to read the non...
I work as a recruiter at a staffing agency. I was recently offered a Part time sales position with that same company. So I would work PT sales, and PT recruiting. Another staffing ...
I recently was fired from my teaching position two weeks before school started in order to allow another teacher to have my class. I was a private contracted employee at a homescho...
Comments (16)add comment
Casey: ...
what if my employer is fired from her client and then I resign and open my own business and work for that client? My agreement is 4 years old.
1

January 07, 2012
Steven Daily: ...
Does the non-compete prohibit you from competing with the former employer in the same industry and geographic area? If so, the fact that this client is no longer a client of your former employer would not seem to me to make much difference. Such a contract is intended to prevent you from soliciting ANY prospects, not just current customers of the former employer.
2

January 07, 2012
MelissaW: ...
What if the business owner that signed the contract although there were 2 other owners NOT present at time of signing. The one signing the contract was going through a divorce with the other owner and recently committed suicide and she has since stepped in. Have worked for company 11 years and it stated can not compete for a year AFTER leaving the company. With the original signee dead can I still be held to that contract with the owner that stepped in?
3

February 02, 2012
Karen F: ...
I belong to a 501 c 3 all volunteer association. At one time one of our members wanted to start another similar group in another part of the state in which I live. So, the leadership of the group had everyone sign a non-compete agreement.
I want to join another similar group in the area that I think will better fit my needs and level of committment.

Here is the agreement with the name of the organization deleted.
This Noncompete Agreement (this “Agreement”) is made effective as of 9/10/2010, by and between xxxxxxx and xxxxxxx member, of, print name____________________ sign name________________________.

xxxxxxxxxx provides members with training that is equivalent to a $15000 training program at other locations.

1. NONCOMPETE COVENANT. For a period of 12 months after leaving xxxxxxx, the member will not directly or indirectly engage in any operations individually or through another group. This covenant includes the joining of another organized group that uses the same function in any way, or starting an organization that uses the same function in any way. This covenant shall apply to the geographical area that includes all of the state of Kansas and any location within 4 hours of Wichita, Kansas.

2. PAYMENT. The member, will pay compensation to xxxxxxx, for the covenants of training an amount decided by the xxxxxxx board not to exceed $15000. This lump sum shall be payable no later than one month after a violation of the above non-compete covenant.

3. CONFIDENTIALITY. The member will not at any time or in any manner, either directly or indirectly, use for personal benefit, or divulge, disclose, or communicate in any manner information that is proprietary to xxxxxxx without board approval. Within 30 days after receiving a written request, member will return to xxxxxxx all records, clothing, documentation and other items used, controlled, or created by xxxxxxx

4. ENTIRE AGREEMENT. This Agreement contains the entire agreement of the parties regarding the subject matter of this Agreement, and there are no other promises or conditions in any other agreement whether oral or written.


Thank you for any assistance with this matter
4

February 20, 2012
cin: ...
i have signed a non-compete with my employer for the last 13 years. It states that I cannot go work for a competitor for 2 years. Is this truley upheld in the state of Kansas?
5

May 31, 2012
Steven Daily: ...
Karen,
In Kansas there must be what the law calls "consideration" or some benefit received by the person who is bound by the non-compete. If this is a volunteer organization, I'm not sure I understand what members received in return for signing a non-compete.

Cin,
Some non-competes of the type you describe are upheld in Kansas, but as the article explains, it really depends on the facts of each situation, including the justification for the non-compete and its geographic scope, which you don't mention in your question. So there's no simple answer I'm afraid.
6

May 31, 2012
Employer: ...
I have a non-compete clause signed in MO that my employer says I'm violating by taking a job in Texas. They agreement says I can't work for a competitor in any market in which they operate. They do operate in Texas as well as 30 other states. Is that reasonable? I'm going to have a hard time finding work.
7

May 31, 2012
Collin: ...
I have a non-compete in KS in with a freight broker. The company I'm employed by is under serious financial termoil and it is preventing me from being able to perform my daily obligations. Is the non-compete null/void in this case? What if they close the business?
8

September 11, 2012
Lily: ...
I worked at a tanning salon that owned a gym for maybe two months, after quitting I got a job at a gym that has a couple tanning beds. I signed one of these statements not completely aware of what I was agreeing to. I'm under the impression it said I couldn't hold a job at any place like that for a whole year... I only worked there for maybe 7 weeks. Is this really able to affect my new job???
9

October 16, 2012
Joanna: ...
I worked for a MLM that had a non compete to not recruit or solicit customers or promoters for 1 year. I have not been recruiting but other promoter and customers have asked me questions and to send samples to them. Will I get in trouble if I send them samples if the contact me first?
10

February 12, 2013
Doug Hecker: ...
I have a non-compete that was signed ~13.5yrs ago (no duration on non-compete) with a KS company. I left the company 9 yrs ago. I have identified and work with a new company (within the last year) that competes with the company I left 9 yrs ago. Is there any concern about the non-compete.
11

April 04, 2013
Deb F in Kansas: ...
I signed a non compete after I had taken a job with my company, when I was taking over a management position in a facility I transferred to. I got about a 1.75% raise. I was told by my supervisor this contract only keeps me from doing work like I do for anyone else DURING THE TERM OF MY EMPLOYMENT WITH THEM. I did not fully read the contract as it was put in front of me in a hurried manner. Now, my company lost their contract in the facility I am employed in. I cannot work for them in another facility because any choice of where to work is over an hour drive for me, and that is not feasible financially. I cannot work for the company taking over, and now they have even prevented me from taking a job in a whole different field n the facility, which IS NOT LISTED IN THEIR CONTRACT AT ALL. I am a supervisor of housekeeping and laundry, the job the facility offered me if for an activity director position--totally unrelated to housekeeping or laundry. I live in a rural area of Kansas where jobs are far and few between. In 1 month I will be unemployed if I can't find a job. I have put aps in different places and not been hired yet. What if anything can I do to fight this non compete, it's ridiculous. If anything they are hurting their reputation more because they are pissing me off and I am more likely to bad mouth them now than if they had let me take the Activities job.
12

June 13, 2013
Tara Marsh: ...
My travel agency, in Kansas, was reacently bought by a company out of New York. The new owner wants everyone to sign a non-compete agreement that prohibits us from working in the travel industry, in the state of Kansas, for 2 years. Is this reasonable or legal?
13

June 20, 2013
Lee C: ...
From my understanding, in the state of Kansas, there has to be a duration and geographical area to make a non compete valid and enforceable. Doug ~ you would have to read the non compete you signed to see the validity of it 13 years later.
14

July 09, 2013
Helpless: ...
I work as a recruiter at a staffing agency. I was recently offered a Part time sales position with that same company. So I would work PT sales, and PT recruiting. Another staffing agency has approached me with an offer that is substantially more then what I am currently making, as a recruiter. However, they said that the non-compete is what is holding up the process. My question is since I signed it as a sales rep would it still stand if I take a recruiter position? Also, three others have left within the last few years, one of them a manager, all three of them went to other staffing agencies and are direct competitors of my staffing agency, yet none of them were pursued legally.
15

July 26, 2013
D. Marie: ...
I recently was fired from my teaching position two weeks before school started in order to allow another teacher to have my class. I was a private contracted employee at a homeschool cooperative that offered classes two days a week. I have been teaching there for the past five years and have built a student caseload based on my teaching reputation. Last year the teachers were made to sign a non-compete contract with the understanding that it was to protect the cooperative from teachers leaving unexpectedly and taking students away from the school. I am under the understanding that if I teach classes somewhere else in the local area, I can do so if I do not solicit students from that school to come to my classes. I have started advertising classes after the school started to get students who would not be going to the cooperative school.
If I was a part-time contracted employee who did not have taxes taken out of my paycheck, can the non-compete clause hinder me from teaching? I am not soliciting students from the cooperative.

I recently found out that I was fired because I did not buy a real estate property this summer from the school administrator,( another business the administrator has to help incur an income) It was felt that I was not supporting the school if I didn't use the this person. The teacher who was put in my place, however did buy real estate from the school administrator. (Is this a conflict of interest?) Unexpectedly unemployed.
16

September 03, 2013

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