covenant (noun, cov-e-nant, \ ˈkʌvənənt \) to compete (verb, com-pete, \ kəmˈpiːt \)
Definition: is an agreement between a worker and his employer that exists in the form of a stipulation written in a contract, which usually forces an employee to avoid working for the company’s direct competitor in a particular area or territory for a pre-established period of time. Other than in worker contracts, such a clause can also be included when a company is being sold, where the selling party agrees to not open a new firm for a number of years in the same field.
In a Sentence:
- During the selling process of the Green Air Motors Corporation, Mr. Phelps was forced to agree to a covenant not to compete before the deal could be finalized.
- The job interview went splendidly, and as soon as I agreed to the covenant not to compete and all the paperwork was done, I was congratulated by my new manager.
- Jane wasn’t happy with the covenant not to compete clause in her contract, as it prohibited her from working in her hometown for five years.
Synonyms and related words: non-compete clause, contract law, non-compete agreement, employment contract
