Noncompete Agreements

Hello, I'm doing some research on signing noncompete agreements. Many nonconpete agreements last for 6 months to a year in the business world, or even longer. Can anyone tell me what the norm is for the martial arts community? I think this is a fairly new topic. What have all of you heard? Please ask around for me. Thanks.

[This message has been edited by instructorswife (edited 01-04-2003).]

Most people today hate signing contracts. I know I do, but in a business they are necessary. For kids it's hard to have contracts becuase they are always changing what they like and don't like. But what my instructor does is he has a clause in his contract saying if you want out all you have to do is give him a 30 day notice. This seems to work very well and having that option makes the customer seem a little bit more comfortable signing the contract.

What kind of noncompete agreement is it?

The ones I am familliar with are related to work - ie. you can't go work for a competitor for 6 months after you leave.

The thing is that the courts hate to enforce noncompete agreements because people generally should be able to ge get a job wherever they want. If this is for your students (that they can't go study at another school) I would think it would be entirely unenforcable.

Check with a competant attorney to be sure - you have to be really careful with these things.

John Moore http://www.blackbeltcopywriter.com

I presume you are asking the question in relation to the USA. In the UK such agreements would most likely be enforced if validly covenanted in a work environment, inititaly through interim injunction. Ive never heard of such an agreement in terms of a non professional martial artist being tied to an instructor. It would simply be a matter of interpretation of the contract and whether it was valid. I would be very suprised if such a contract was enforceable, especialy given European Community legislation and Human Rights legislation. Another point to note is that in the UK, contracts are mostly unenforceable against a minor (under 18).

Regds
Mr V

Firstly, you are going to set a negative tone in any relationship by asking someone to sign away their rights to earn a living.

Be the best person in the world to work for and take very good care of your staff. Train them, praise them and allow them to grow. Notice I didn't say give them all your money. Set up a bonus plan based on the performance of the school as a whole. X amonut for new business goals, X amount for retention goals, X amount for equipment sales, X amount on test fees and X amount on renewals. If they leave they won't want to compete with you anyway and if they do others will see them as less than honorable.
Plus this a great way to build your business with franchised location as you set up your staff members in schools that they can own with you and be part of something bigger and better for everyone.

Noncompete agreements are contracts that you sign agreeing not to open a Dojo
within a certain distance of your instructors Dojo. This prevents compitition between Dojos and also prevents taking bussinuss from your instructor. This agreement usualy occurs when your instructor has developed a successful bussinus and doesn't want to lose students do to location or instruction preference. Your instructor will usually ask you to sign the contract close to the period of your teaching lisence (wich depends on the organization that he/she is affiliated with. If you refuse to bind into this agreement it is possible your instructor may prevent you from aquiring your proper credentials. If that is the case you need to go else where because that instructor is not a true Karateka. As far as legalities there are none. Example: The USKA requires that you do not open a Dojo within 5 miles of your instructors Dojo. If you do all that will happen is that you will lose your mebership to the USKA.
You must determine how important that mebership is. Like I said before I have a problem with an instructor who requires this, therefore I also have a problem with an organization that also requires this.

ps "Commercial Americanized Karate" is a bussinus. True Okanawan Ko Karate is much different.

ps excuse any spelling or grammar errors

Thank You,
Peter

Non-compete agreements are an Illegal way to limit competition. I was required to sign one for a business i was working for, but I along with the other 6 people that worked there, refused to sign. Half of us were terminated 6 weeks later.

As for somthing the students are to sign, i once signed an agreement that stated i would be at the school at least 2 days a week to train, and if i decided to quit i was responsible for the remaining balance of the contract. Talk about caught by the balls. The contract also said nothing about getting out of the contract early. If i didn't think i was getting the training i wanted, so what.

matt

There is an instructor in the UK being sued under the non compete clause in his contract and the because the group doing the suing has almost limitless funding they simply kept the case going until he had lost his home. family, car and all monies.... this serves as an example to other instructors, try to leave and open a club in our area and we will bankrupt you......

[QUOTE]Originally posted by malanr:
Non-compete agreements are an Illegal way to limit competition.[/QUOTE]

They are not illegal, so long as they do not exceed reasonable scope and duration.

In my opinion, if I am a good teacher and what I teach has worth, then there is no need for such an agreement. I like to have other schools in town. We get a chance to share and learn. I disagree with the whole notion of this, but again this is my own opinion. My school is non-profit.

Non competes vary stae to state.
Some states invoke a "will to work" policy in that you can NOT sign away your right to work in a valid field of employment. Others do not.

In regards to Martial Arts, it is indeed a sad fact of life that most US schools now operate as a business, and as such may look at Non competes to protect their business.

My personal take on this is that if you and your school are reputable and strong you shouldnt lose students to another instructor that you trained.

One of your students should be Encouraged to open up a school when he or she is qualified, and common scence would dictate not opening the school on your sifu, or sensei's doorstep.

I do not require a non compete or have ever entertained the idea of requesting one, and have never had a problem.

I would hope any student that I train and bring to the level of instructing, that he or she would have the proper respect and NOT open a school in direct competition with me. Infact If I had a student that was to do that I would blame myself for not instilling in them the correct martial values that any good instructor should have.

It has actually gotten to the sad state of affairs that one instructor opens a school. He trains someone to 2nd/3rd black. Instructor and black belt have a personal argument. Bb leaves and opens his own school. There is now political bs involved and original instructor loses 1/3 of his students. Doesn't matter who started the fight. Unfornately, building space has to be paid for, utilities have to be paid for, and sometimes the dojo takes up so much of an instructor's time that he has a living to make. I hate to say it, but a non-compete contract has become a necessary evil in America today, especially in some areas, such as small towns. It can be really hard to replace 20-30 students in your dojo in a larger area as it is. It's something of a wrong to have to do it, but I wouldn't want to jeopordize my ability to teach, especially if I've been putting in 40+ hours a week into a dojo.

There is a reasonable scope and duration for a noncompete agreement. For instance, not that I would actually do this, but if I were to achieve appropriate rank, and my instructor did not require a noncompete agreement from me, I could actually open a dojo across the same small town, and theoretically bankrupt him. Wouldn't actually happen, as he'd be a 7th or 8th black by that time. However, when one of your students goes for black belt, a noncompete isn't a bad idea if you don't trust the student implicitly with your business. How do you know he/she won't just sever ties and move across town, possibly taking a large enough chunk of your students with him/her.