restraint of trade

Restraint of trade refers to any agreement or practice that limits a person's ability to work freely, compete, or conduct business. For example, if an employee signs a contract that prevents them from working for a competitor after leaving a company, this is a restraint of trade. Courts generally evaluate such agreements carefully to ensure they are reasonable in scope and duration; overly restrictive clauses may be invalid because they unfairly restrict free competition and individual livelihood. In essence, restraint of trade balances protecting business interests with allowing fair market competition and individual employment rights.