TN 8 (11-93)

RS 01401.110 Agreement Not to Compete Payments - Wages

A. DEFINITION

Agreement not to compete payments are payments to an individual who agrees not to engage in a competing business for a specified period of time.

B. POLICY

Payments from an agreement not to compete are wages if the payments stem from an employer-employee relationship (see RS 02101.115).

EXAMPLE: Employee retires and enters into a contract with the corporation providing that the employee will not engage in a competing business before a specified date. Employee will be paid $500 a month for such services and such agreement to refrain from competing. The full $500 a month constitutes wages.


To Link to this section - Use this URL:
http://policy.ssa.gov/poms.nsf/lnx/0301401110
RS 01401.110 - Agreement Not to Compete Payments - Wages - 07/24/2002
Batch run: 07/03/2014
Rev:07/24/2002