Nike v. McCarthy supports which conclusion about enforceability of a noncompete tied to a promotion?

Nike v. McCarthy supports which conclusion about enforceability of a noncompete tied to a promotion?

• A. A noncompete is enforceable only if signed after the employee accepts a promotion but before duties begin.
• B. A noncompete requires a noncompete fee.
• C. A noncompete must be reasonable to protect a legitimate employer interest and tied to a bona fide promotion with increased responsibilities.
• D. A noncompete can be enforced without consideration.

Answer: (C)

When a noncompete is tied to a promotion, its enforceability hinges on reasonableness in protecting a legitimate employer interest and on a real change in the employee’s duties. Nike v. McCarthy shows that the restraint should be narrowly tailored to protect legitimate business interests (like trade secrets, goodwill, and customer relationships) and must accompany a bona fide promotion that actually increases the employee’s responsibilities. The promotion itself often serves as consideration for the restriction, tying the restraint to a genuine change in the employment relationship. If the promotion isn’t genuine or there’s no real increase in duties, the noncompete tends to be unreasonable or unenforceable.

When a noncompete is tied to a promotion, its enforceability hinges on reasonableness in protecting a legitimate employer interest and on a real change in the employee’s duties. Nike v. McCarthy shows that the restraint should be narrowly tailored to protect legitimate business interests (like trade secrets, goodwill, and customer relationships) and must accompany a bona fide promotion that actually increases the employee’s responsibilities. The promotion itself often serves as consideration for the restriction, tying the restraint to a genuine change in the employment relationship. If the promotion isn’t genuine or there’s no real increase in duties, the noncompete tends to be unreasonable or unenforceable.