The Changing Landscape of Wisconsin Noncompetes
In Frank D. Gillitzer Electric Co.v. Andersen, a Wisconsin Appellate Court found that a provision in an employment contract that required an employee to repay certain training costs if the employee did not stay with the employer for four years after the training was completed did not violate Wis. Stats. § 103.465. This was the case even though there appeared to be no disagreement that the “separate” explicit noncompete portion of the employment contract was overbroad and did violate §103.465. This decision follows a the recent Wisconsin Supreme Court decision in Star Direct v. Dal Pra where the court appears to look more favorably about reading divisibility into employment contracts (as opposed to striking all restrictive covenants in an agreement containing an overbroad covenant). This holding brings up some interesting questions to consider when drafting or litigating noncompetes. What would the result be if the employer would set forth in the employment agreement that 10% of an employee's earnings during first 5 years of employment were really excess payments (or training costs) and if she leaves during that 5 year period, she owes the company 10% of her earnings during her employment?
