A South Dakota non-compete agreement can be used to restrict the information that someone can share during and after a term of employment. It can also limit where someone can work during or following employment with a specific business.
A South Dakota non-compete agreement aims to prevent confidential information from being shared by current and former employees.
Is a Non-Compete Legally Enforceable in South Dakota?
A non-compete agreement is legally enforceable in South Dakota; however, it must be written appropriately to ensure that undue restriction is not placed on the employee. [1]
Reasonable Use and Exemptions
A South Dakota non-compete agreement must also meet all reasonable use and exemption guidelines. For example, the restriction can only apply to the same business or profession as that carried on by the employer. In addition, a non-compete agreement in South Dakota cannot exceed two years. A reasonable geographic area has to be specified, and the scope of the agreement could not be unduly harsh or restricted on the employee. The employer must justify why certain geographic restrictions are being given.
- Enforceable when terminated without cause? Yes, factor
- Employee non-solicitation agreement permitted? No
- Customer non-solicitation agreements permitted? Yes
- Does continuing employment equal sufficient consideration? Yes
Non-Compete Agreement South Dakota Limitations
If you are writing non-compete agreements in South Dakota, there might be a few potential limitations to keep in mind. If the South Dakota non-compete agreement does not conform to the limitations listed below, a judge could throw it out if it is challenged in court.
Time Limitations
A non-compete agreement in South Dakota cannot last longer than two years from the agreement’s termination date if the employer continues to carry on like a business. Furthermore, if there is a breach of the non-compete agreement and South Dakota, the impacted party has up to 6 years to bring a lawsuit related to potential damages.
Geographical Limitations
In South Dakota, no geographic limitations are written into the state’s statutes, but if the non-compete agreement is too restrictive for a former employee, it could be challenged in court. South Dakota employers will have to justify why the geographic limitations have been put in place if the agreement is challenged. The agreement might be thrown out if the limitations cannot be justified.
South Dakota Non-Compete Agreement Sample
When you are writing a non-compete agreement, make sure you use this South Dakota non-compete agreement template. You can download it in Word or PDF format:
