Tennessee Noncompete Agreement: What's Included and Enforceability

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Is a Non-Compete Agreement Enforceable in Tennessee?

Yes. In Tennessee, non-compete agreements are enforceable if the contract is used to protect and legitimate business interest and is reasonable. Courts will determine whether a non-compete is reasonable based on the following factors:

• Employer's interests. The employer must be faced with a threat to their business in the absence of a non-compete agreement.
• Employee hardship. The contract cannot impose economic hardship on the employee.
• Consideration. The agreement must be supported by adequate consideration.
• Public interest. The agreement cannot negatively affect the public.

When determining whether to enforce a non-compete agreement, courts will also consider the information that the employer is seeking to protect. There must be a legitimate business interest like trade secrets. Non-compete agreements cannot be used solely to prevent reasonable competition.

How Long Does a Tennessee Non-Compete Agreement Last?

Courts in Tennessee have ruled that two years is a reasonable length of time for a non-compete agreement to last. Under a two-year non-compete agreement, the geographic boundary can extend nationwide as long as the employer’s business has a presence nationwide.

How Do You Get Around a Non-Compete Agreement in Tennessee?

To get around a non-compete agreement in Tennessee, an employee will need to prove that the agreement is unreasonable. If the employee is facing undue hardship because of the agreement or the terms of the agreement are overly restrictive, they may be able to convince a court to terminate the contract.

What Voids a Tennessee Non-Compete Agreement?

A non-compete agreement in Tennessee will be void if an employee was wrongfully terminated. When an employee is fired in good faith, an employer can usually enforce a non-compete agreement. However, if the employee signs the non-compete agreement and is terminated shortly after, a court may find the contract void because it was not signed in good faith.

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