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By having employees sign this type of agreement, employers can ensure that they will not be risking losing customers and personnel to the people that they train and employ. Once they have signed, the employee will need to follow the contract’s terms to avoid liability.
- Statutes: N/A
- Legally Enforceable? Yes, with the below requirements and exceptions.
- Requirements/Exceptions:
- Non-solicitation agreements cannot be against public interest, cause undue hardship on the recipient, and must protect a legitimate business interest.[1]
- Can prohibit the solicitation of current customers; it is likely to be deemed overly broad if the agreement also prohibits prospective customers.[2]
- May not apply to customer relationships fostered without the business’s aid.[3]
Sources
- Solari Industries v. Malady, 55 N.J. 571 (1970)
- Platinum Mgmt. v. Dahms, 285 N.J. 274 (1995)
- Meadox Meds. v. Life Systems, 3 F. Supp. 2d (1998)
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