Non-Competition Agreements in Alaska

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 Alaska

Alaska courts generally disfavor non-competition agreements because they tend to restrain trade and place a hardship on former employees' ability to earn a living.  Because of this, the courts scrutinize such agreements carefully taking into account the following factors:

• whether the duration and geographic scope of the restrictions are reasonable
• whether the employee was the sole contact with a particular customer
• whether the employee had access to confidential information or trade secrets
• whether the competition being restricted is unfair or merely ordinary competition
• whether the inherent skill and experience of the employee is being stifled
• whether the benefit to the employer is outweighed by the detriment to the employee
• whether the restrictions bar the employee from her sole means of support
• whether the employee's talent was developed while employed by the employer, and
• whether the forbidden employment is merely incidental to the main employment