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The Missouri Court of Appeals once again faced issues of whether an employer, a supplier of bags used to store and transport dry bulk goods, could enforce a non-compete agreement action against its former employee who resigned from his position as a salesperson.

The law of non-compete agreements in Missouri seeks to balance the competing concerns between an employer and employee in the workforce, according to the state’s Supreme Court.

Employers have a legitimate interest in “engaging a highly trained workforce without the risk of losing customers and business secrets after an employee leaves his or her employment.”

Employees have a legitimate interest in “having mobility between employers to provide for their families and advance their careers.” Additionally, “although the law favors the ability of parties to contract freely, contracts in restraint of trade are unlawful.”

In this particular case, the employee argued that his former employer had materially breached the parties’ employment agreement because it reduced his salary from $70,000 to $57,000; made a unilateral reduction in the level of his sales commission; and did not pay a monthly car allowance.

On the other hand, the employer countered that the employee himself had requested the change in salary and compensation structure. Moreover, the company asserted that even with the changes, the employee’s overall compensation could have eclipsed the prior $70,000 level.

The appeals court confirmed that under Missouri law an employer that has materially breached an employment agreement before an employee has violated a covenant not to compete may not enforce the covenant.

However, in this instance, the court found that there were factual disputes about whether a material breach had occurred, and that had to be decided by a jury or trial judge. Therefore, the employee was not entitled to a summary judgment.