You can refuse to sign a noncompete agreement, but doing so may affect whether you receive or keep the job. The consequences also differ depending on whether you are considering a new position or an employer is asking you to sign a restriction after you have already started working.
Refusing as a new hire versus current employee
If signing the noncompete is a condition of the job offer, an employer may decide not to move forward if you decline to sign. The details of the offer and the agreement’s terms can affect what happens next.
Current employees face a different issue when an employer introduces a new noncompete. Pennsylvania law generally requires new and valuable consideration when an employer asks an existing employee to enter a restrictive covenant after employment has begun. Continued at-will employment alone is not sufficient consideration for a new restrictive covenant.
Negotiating terms before signing
You may still be able to negotiate the agreement. Possible areas for negotiation include the length of the restriction, geographic scope and types of work covered.
For example, you might ask whether a two-year restriction could become six months or whether a broad geographic limit could apply only to a specific county. An employer may be willing to narrow the restriction while still protecting valid business interests.
Know when to seek legal advice
Pennsylvania courts consider several factors when evaluating a noncompete. These include whether the agreement is supported by adequate consideration, whether its duration and geographic scope are reasonable and whether the restriction serves a valid business purpose.
Special rules may apply to certain health care providers. Pennsylvania’s Fair Contracting for Health Care Practitioners Act limits certain noncompete agreements involving covered providers.
Violating an existing noncompete raises separate questions about whether the restriction is enforceable and what remedies the employer may seek.
Review the agreement before signing
Refusing to sign does not guarantee that an employer will change the agreement or keep a job offer open. Before agreeing to any restrictions, you can ask questions, negotiate terms and have the agreement reviewed by an attorney.
