Non-compete for a massage franchise. Very restrictive. No massage for 1 year of termination. 10 mile radius of 2 locations.

Yes, the franchisee is allowed to restrict your post-term competition. While the courts disfavor restrictions on a person’s ability to earn a living, Indiana courts generally enforce non-compete agreements, as long as their provisions are reasonable in terms of the restrictions imposed, the length of time and the geographic scope, and being reasonably necessary to protect the legitimate business interests of the employer. This answer assumes that Indiana law governs your non-compete agreement. If you read through your non-compete agreement and see a Choice of Law provision that states that another state’s law rules the contract, then the remainder of this answer is moot, and the facts must be reconsidered under the laws of the appropriate state. Whether you are a potential hire or an existing employee, your employer can require you to sign a non-compete agreement. The only consideration required is either the offer of employment (if you are a new hire) or continued employment, if you are an existing employee. In order to be enforceable, the restriction must be reasonable in terms of protecting a legitimate business interest. In your case, there are not many licensed massage therapists, and a good one is hard to find. The franchisee wants to prevent you from competing against them and taking their customers. That’s a legitimate business interest. It’s likely that the massage studio serves clients as far away as 10 miles, so there is a legitimate interest in protecting itself from you poaching its customers by prohibiting you from competing within that 10-mile radius. If the radius were 50 miles or the entire state, that is overbroad and would likely not be upheld in this case. However, while you worked at one location, if the franchisee owns two locations within the area, it is reasonable for them to prohibit you from competing against the other location as well. Finally, a 1-year prohibition is actually very reasonable. Courts will ordinarily honor restrictions up to 2 years and sometimes more. There was a case in Indiana last year where a judge upheld a 5-year restriction (Mayne v O’Bannon Publishing Co., 36 IER Cases 279 (Ind. Ct. App. 2013)). A 5-year non-compete is certainly beyond the norm, but 1-year is most certainly reasonable. All in all, from the details you have provided, and without seeing the entire agreement or knowing all of the circumstances, I can tell you that it seems very likely that your non-compete would be valid and enforceable. Your second question is what is your recourse. Realistically, your only recourse is to refuse to sign the agreement. However, in doing so, you will likely either not be hired (if you are a new hire) or you could be fired (if you are an existing employee). The franchisee’s ability to fire you assumes that you do not have an employment contract. Indiana is an at-will employment state. This means that, unless there is an employment contract, an employee can quit his or her job at any time for any reason. Conversely, it also means that an employer can fire an employee at any time without notice for any reason or for no reason at all. The employer can also modify the terms or conditions of employment or terminate the relationship altogether. Your refusal to sign a non-compete agreement would provide the franchisee a reason to fire you. This is probably not what you wanted to hear, but I do believe that the franchisee’s non-compete agreement, as you have presented it here, is reasonable and would be enforced by a court. Your recourse is to not sign the agreement and go to work for yourself or another competitor. I hope you have found this information helpful and I wish you good luck.

Depending on the precise language in your contract, you may have no legal recourse other than to negotiate a release or waiver from the non-compete restrictions, which franchisees rarely have enough bargaining leverage to successfully negotiate. Non-compete law varies from state to state, but if the restrictions are deemed reasonable and supported by consideration, then courts (in most states) will enforce them. Restrictive covenants are very common in franchise agreements and understandably so. You should contact a business attorney in your state experienced with non-compete issues to advise you on the specifics of your situation and the applicable law.