Sometimes an employer’s greatest legal concerns do not arise until after an employee has left the company. Unfortunately, at that point, it may be too late for the employer to adequately protect its interests. In the absence of a restrictive covenant in an employment agreement or stand-alone agreement, a company’s former employees are generally free to:
This relative freedom can result in great harm to the previous employer, especially in instances where the former employee had particularly strong relationships with customers, vendors, or other employees, or where the former employee had access to significant and potentially damaging business information such as a trade secret or proprietary information. In short, unless a company requires that its employees execute legally enforceable restrictive covenants there may be no way to prevent former employees from taking the training and knowledge provided and using them for the benefit of a direct competitor.
Although restrictive covenants have generally been enforceable in Iowa, they may...
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