Non-Competition requires “Consideration”

Non-Compete and other restrictive covenants (contracts) are generally enforceable in Kentucky if they are reasonable in geographic and temporal scope and as long as they are supported by “consideration”. These restrictions are contracts which therefore that must be supported by consideration, e.g. something new of value. For a new employee, the offer of employment is sufficient consideration.

When the employer requires an existing employee to sign a non – compete, particularly if it contains additional restrictions, new consideration is required such as a raise, bonus or some other compensation or benefit to the existing employee.

Any employer planning to require existing employees to sign a new Non- Compete (or Non-Solicitation or confidentiality provision) should plan any such initiative carefully.