The Tennessee non-compete & non-solicitation agreement is used to prohibit employees from engaging in unfair business competition against their employer. An employee who signs the contract agrees to refrain from operating with similar businesses both while employed and for a specific duration after their employment expires. The employee also agrees to keep from soliciting the employer’s customers, contractors, or other employees. In the event that the employee breaches the contract, the employer will need to provide evidence to the court that the restrictions were reasonable (e.g., imposed solely to protect the employer’s business interests). Conditions which are unreasonable, and potentially unenforceable in court, may include a nationwide geographic restriction prohibiting the employee from working for similar businesses in the country.
Laws – Tennessee statutes only mention laws for non-compete and non-solicitation agreements signed by health care providers. According to § 63-1-148, after a health care provider’s employment ends, the employer can impose competitive restrictions under the following conditions:
- All restrictions are established in writing and signed by the employee and employer
- The restrictions must not endure longer than two (2) years
- The geographic limitation is specific to either of the following:
- Ten (10) miles from the primary place of business
- The county in which the business is located
- No geographic limitation, though the employee may not operate at any facility where the employer offers health care services
Non-Compete Limit – Tennessee statutes only cover competitive employee restrictions for health care providers (see “Laws” above).
Non-Solicitation Limit – Tennessee statutes only provide information on employee restrictions when imposed on health care providers (view “Laws” above).