by Ryan B. Frazier
A new law passed by the Utah Legislature and signed by Governor Gary Herbert places new restrictions on noncompetition agreements signed after May 10.
All requirements imposed under common law not specifically changed by the new law are still applicable, meaning that noncompetition agreements must protect a legitimate business interest of the employer and must be reasonably limited in geographic scope.
The primary change is the creation of a statutory limitation on the duration of a covenant not to compete. Under the new law, an employer and an employee cannot enter into a noncompetition agreement that lasts more than one year from the date the employee is no longer employed by the employer.