Page 6 - Rules of the Road-Non Compete Agreements

Compensation problems: there is a basic principle of contract law that says a

material breach by one party excuses performance by the other. In other words,

the first party to breach a contract may not be able to expect performance by the

second of other promises. Where this comes up in the context of non-competes is

where an employer has not paid the employee all agreed wages or commissions. In

cases like that, some courts have found that because the employer materially

breached the terms of employment, the employee was excused from complying

with the non-compete provision.

For each of these scenarios, there are court decisions enforcing non-

competes and declining to enforce non-competes, but it pays to be aware of these

possible reasons for non-enforcement, even if the non-compete agreement

otherwise meets the requirements for enforcement under Massachusetts law.

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