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What Are the Differences Between a Non-Compete and NDA?

A non-disclosure agreement (NDA) and a noncompete agreement can both be important for businesses. With both, the general idea is to keep your proprietary business information safe from competitors and prevent someone from leaving your business and using what they've learned there to directly compete with you. To decide on the best agreement for your needs, contact a contract attorney in Las Vegas to go over the details.

Non-Compete Agreement

The purpose of a noncompete agreement is to make sure that an employee in particular, but sometimes other entities as well, don't leave their employment with you or end a contract working with you and then immediately go into direct competition by setting up their own company. These agreements typically have both a time and geographic limit. For example, they might specify that employee cannot set up their own business in the same field as you work within a year after leaving your employment and within 50 miles of your business.

These agreements are not enforceable in some state states but they are here in Nevada. However, they have to be formulated exactly right in order to be enforceable, so it it's essential to have an attorney help you make sure that you cross all your t's and dot all your i's.

Generally, a Nevada court will look to see that these agreements are reasonable in their scope and duration, meaning that if you try to restrict someone for more than a couple of years at the longest, the agreement will probably get tossed out. The agreement also has to clearly protect your legitimate business interests rather than simply stifle competition or try to keep your employee from being able to pursue their own business to force them to continue working for you. Finally, the court looked to see that these are "fair," which is a subjective standard but generally means that you can't create undo hardships for your employee or make things too vague.

Non-Disclosure Agreement

A non-disclosure agreement simply restricts employees or independent contractors from disclosing any proprietary information or important restricted information about your company. These can be a bit broader than NDAs because the purpose is to protect your company's position in the market and to ensure that you don't have a competitor sneak someone in to take advantage of you. It also means that, even if a competitor hires an employee out from under you, they can't get certain information out of that employee. They are only allowed to hire them for their talent: not for their knowledge of your company.

Talk to a Las Vegas Contracts Attorney Today

Whatever type of contract you need, it's always best to draft it and have it reviewed by an attorney. That way you can have confidence it will stand up to challenges in court and provide you with exactly the protections that you expect. For help with your contracts, contact us at the Hutchings Law Group in Las Vegas, NV today. 

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Should I Hire a Lawyer Before Signing My First Business Contract?

If you're about to sign your first business contract in Las Vegas, NV, pause a moment. Before you put your name on that paper, take a moment to search "contract lawyer near me" and get at least a short review. That review could spare you years of expensive cleanup if something goes wrong. How a "Contract Lawyer Near Me" in Las Vegas, NV Can Help This document decides who pays, who owns the work, how long you are bound, and where you must fight if the other side doesn't fulfill their agreement, and once you sign, your leverage shrinks. It's important to get this right. Specific Nevada Issues Nevada has some contract writing rules that can catch first-time signers off guard. A sale of goods priced at $500 or more, for example, is not enforceable unless there is a signed record showing that a sale was made. An agreement that, by its own terms, cannot be performed within one year is void unless it is in writing and subscribed by the person you would try to hold to it. Your Disadvantage Landlords, software vendors, franchisors, and larger customers send their "standard" contracts first, and that paper always allocates risk away from them. Indemnity language may require you to pay their legal bills if a third party sues, for example, and even for harm they caused. All these clauses sit in sentences you will tend to skim because they're often deliberately written to be obscure. And lest you think this is an exaggeration, World Commerce & Contracting has measured what sloppy contracting costs and found that it drains value equal to nearly 9% of annual revenue, on average. Hiring Can Be Tricky Calling someone an independent contractor in an agreement does not settle the question for the IRS. The IRS looks at control: who directs how the work is done, not only what must be delivered. The Department of Labor applies an economic-reality test under the Fair Labor Standards Act. If you treat a worker as a contractor and the law later treats that person as an employee, you can owe back wages, employment taxes, and penalties. And whomever you employ, you have to make sure it's clear who owns anything they produce and what they're allowed to do with information they discover about your company. The contract needs to protect you and clearly cover scope, payment, ownership of work product, and confidentiality. Templates Are a False Economy Templates are cheaper than hiring a lawyer only if nothing goes wrong. A generic form does not know about Nevada's writing statutes, does not know whether your entity is an LLC, can't tell you that you signed in your personal name instead of the company's (which can destroy the liability shield you formed the company to create), and won't catch a conflict between the statement of work and the master terms. Do not sign first and hope the terms will be kind later. Contact us now at the Hutchings Law Group, serving small businesses in Las Vegas and greater Nevada, so we can read through your contract before the signature line becomes your problem.

How Much Does It Cost to Form an LLC in Nevada?

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