A North Dakota non-compete agreement is a contract created for the purposes of protecting an employer’s business, confidential information, clients, customers, and other employees by prohibiting an employee from going into competition with the employer upon termination of employment. In most states, any employer can demand that an employee sign a non-compete agreement before they start their position. In the State of North Dakota, however, non-compete agreements are only valid and enforceable if they are connected to the sale or dissolution of a business. An employer cannot demand that an employee sign a non-compete agreement simply because they want to stop this employee from working for or starting a company that directly competes with the employer’s business. A non-compete agreement may be drafted in situations where an employer sells the goodwill of their business to a buyer and the buyer finds it necessary to prohibit the seller from establishing a similar business within a specified geographical area. Also, an agreement may be drawn up in anticipation of the dissolution of a partnership; in this case, the partners agree not to establish a similar business in the city where the business/partnership existed.
Laws – § 9-08-06
Non-Compete Limit – No exact definition; a court of law reviews each agreement/case separately and determines what a “reasonable” amount of time would be.
Non-Solicitation Limit – No exact definition; a court of law reviews each agreement/case separately and determines what a “reasonable” amount of time would be.