Rhode Island Noncompete Agreement: What's Included and Enforceability

Quick Facts — Noncompete Agreement Lawyers

Is a Non-Compete Agreement Enforceable in Rhode Island?

Yes. In Rhode Island, non-compete agreements are permitted, however these contracts must follow certain rules and exceptions.

Non-compete exceptions in Rhode Island include:

  1. Non-competes cannot be entered into by low wage workers. Low wage workers are those who make less than 250% of the federal poverty level. For 2023, that is $33,975 annually for a one-person household.
  2. Short-term employees or students who participate in internships cannot enter into non-compete agreements.
  3. Employees under the age of 18 cannot be restricted by a non-compete agreement.

How Long Does a Rhode Island Non-Compete Agreement Last?

Courts in Rhode Island have restricted non-compete maximum terms to one year. In addition, the geographic area is limited to only areas where the employer conducts business.

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

To get around a non-compete agreement in Rhode Island, an employee must show a court that the agreement does not adhere to the rules and regulations governing non-compete agreements set out by state laws and the supreme court. Some of these rules include:

  1. Protectable interest. The agreement must protect an employer’s legitimate business interests and cannot be used to limit competition.
  2. Reasonableness. The contract terms must be reasonable and cannot impose undue hardship on the employee.
  3. Consideration. A non-compete agreement must be supported by adequate consideration. In Rhode Island, continued employment is sufficient consideration.

If a non-compete agreement fails to follow these standards, an employee can move to have the agreement terminated.

What Voids a Rhode Island Non-Compete Agreement?

A non-compete agreement in Rhode Island is void if an employee can prove that they didn’t enter the contract voluntarily or if they entered the contract under fraud. All contracts must be signed free of coercion or threat. In addition, enticing someone to sign a contract under false pretenses will make the contract void.

Frequently Asked Questions

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Employment

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Asked on Mar 31, 2021

Can I get out of my noncompete agreement?

I am looking at my options.

Donya G.

Answered Mar 31, 2021

You may be able to be released from a non compete. You would have to review the language in the non compete to see the expiration. DISCLAIMER The answers to these questions do not constitute legal advice and does not create an attorney-client relationship with the attorney and anyone who reviews these responses.

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Asked on Jun 3, 2023

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I recently accepted a promotion within my company and was asked to sign a noncompete agreement. I am concerned that if I accept the promotion and then leave the company, that I will not be able to take a similar position with another company. I am also worried that if I don't accept the promotion, I may be at risk of being terminated. I need to know what my rights are and what the implications are of signing the noncompete agreement.

Thomas L.

Answered Jun 16, 2023

It depends on the terms of the non-compete and the size of your employer. Without seeing the agreement and knowing the size of your employer, I can't offer more advice.

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Gagandeep K.

Answered May 30, 2023

The non-compete agreement will likely specify the non-compete period/time restriction. If that is not obviously stated, you should consider having an attorney review the non-compete agreement. Typically, a non-compete agreement in a partnership or LLC places a geographic limitation for a certain time period such that the partner/member is prevented from carrying-on a similar business in a geographic area where the partnership/LLC has done and continues to do business. You can read more about non-compete agreements in California here: https://www.contractscounsel.com/t/us/noncompete-agreement/california.

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Can my employer enforce a non-compete agreement I signed even though I was not provided any additional compensation or benefits in return?

I recently started a new job and was asked to sign a non-compete agreement as a condition of employment. However, I just found out from a colleague that my employer has been enforcing the non-compete agreement against former employees and preventing them from working in similar roles at competing companies. I am concerned because I was not given any additional compensation or benefits in exchange for signing the agreement, and I believe it may be unfair and potentially unenforceable. Can my employer legally enforce the non-compete agreement even though I did not receive any additional compensation or benefits in return?

Damien B.

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Hello! Generally, New York courts require that a non-compete agreement be supported by adequate consideration. If the agreement is signed at the beginning of employment, the job itself may serve as adequate consideration. However, if the non-compete is signed after employment begins, the employer may need to offer additional benefits, such as a raise or promotion, for the agreement to be enforceable. There are other defenses against enforcement. For a non-compete agreement to be enforceable, it must be reasonable in terms of duration, geographic scope, and the scope of activities it restricts. A court will evaluate whether the agreement is necessary to protect the employer’s legitimate business interests, such as confidential information or customer relationships. If not, a court could rule the noncompete is not enforceable.

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Asked on Jul 4, 2023

How does a noncompete agreement work?

I am an employee at a small business and I have recently been asked to sign a noncompete agreement. I am not sure how these agreements work and what rights I have as an employee. I am also concerned about the restrictions that could be placed on me if I sign the agreement. I want to make sure I understand the implications of signing the agreement before I do so.

Nancy B.

Answered Aug 4, 2023

In its simplest terms, a noncompete agreement in an employment context is an agreement that says you will not compete with your former employer if you ever stop working for them. It typically forbids things like: + Working for a competitor + Starting a company that sells the same services/products as your employer + Recruiting employees from your current employer after you have left that employment. One thought is that this could be requested shortly before letting an employee go just to protect the company from competition but I hope that is not the case here as it seems like an unfair use of the noncompete agreement ability in Georgia. The issues are usually the geographical scope (for example within 15 miles of Dalton, Georgia), the time period (one or two years is usually sufficient and courts do not favor long noncompete agreements), and the consideration (such as a new job - which is not applicable in your case, or more compensation). Regards, Nancy A. Burnett

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