Question

A clause in a contract that prevents an employee from working for an employer's competitor after the employment relationship terminates for a specified time and in a specified geographic area is referred to as a(n):

A) Noncompete clause.
B) Termination clause.
C) Unconscionable clause.
D) Adhesive clause.

Answer 1

A noncompete clause is a provision in an employment contract that restricts an employee from working for a competitor after the employment relationship ends.

Step-by-step explanation:

The clause in a contract that prevents an employee from working for an employer's competitor after the employment relationship terminates for a specified time and in a specified geographic area is referred to as a noncompete clause. This clause is commonly included in employment contracts, especially for positions that involve sensitive information or specialized skills.

Noncompete clauses are designed to protect the employer's interests by preventing former employees from using their knowledge and skills to benefit a competitor. The specified time and geographic area are usually determined based on what is reasonable in relation to the nature of the work and the industry.

For example, a noncompete clause may prohibit an employee from working for a competitor within a specific radius of their current workplace for a period of one year.