How binding is a non compete in Michigan

UPDATED: Oct 1, 2022

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How binding is a non compete in Michigan

I currently work for a medical software company as a trainer in which I train staff
from private practices. I was offered the same type of position to work for a
hospital. My current company does some work with this hospital but nothing to do
with my position. I am worried they will say this is a breach of non compete. Do I
have to tell them where I am going?

Asked on March 24, 2019 under Employment Labor Law, Michigan


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Non-compete agreements are legal in MI, though they are not favored by the law or courts. That means that they are only enforceable to the extent reasonably necessary to protect legitimate interests of the former employer from competition--e.g. potential loss of business or clients--by a former employee using his/her knowledge, skills, experience gained at least in part at the employer. If there is no real potential impact from the new job on the old employer, the agreement will likely not be an issue.
So if in this new position you might cost or take business away from the former employer--e.g. cause the new employer to stop doing business with the former employer--this could easily be a violation of the non-compete. On the other hand, if the new position will not reasonably have any impact on the old employer, it would not be breach of a non-compete.
However, there is a related kind of agreement called commonly a "non-solicitation" agreement which specifically prohibits employees from working with or for clients/customers of the former employer. These agreements are fully enforceable, since the impact on the employee is seen to relatively slight: it only bars working with/for certain defined businesses. If you have a clause or agreement like this, it might bar you from working for this hospital even if you are not competing.

IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

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