After purchasing 16 newspapers in 2011, the Halifax Media Group asked their new employees to sign an agreement preventing them from working for other media companies in other cities with Halifax properties for two years if they left the company.
This sort of agreement is called a “non-compete agreement,” or “restrictive covenant.” These agreements prevent former employees from going and working for competitors, limiting the chances that the employee will share trade secrets or other inside information with the competing company.
If an employee violates a non-compete clause, he or she can be subject to monetary fines or other penalties. Non-compete clauses can make it quite difficult for employees to find a future job or even become self-employed. However, they usually have no choice but to sign the agreement. The employer has all the power.
Some states, for the reasons stated above, highly restrict non-compete clauses and some states—like California—don’t allow non-compete clauses at all. Non-compete causes differ throughout the various states. Some principles that are common in most states, though, include:
- Reasonableness rule: The clause must be reasonable to be considered valid.
- Duration: The duration of the non-compete agreement must be limited—usually a period of one or two years.
- Distance: The geographic limits should also be reasonable.
- Blue Pencil Rule: Courts have the authority to modify a non-compete contract if they find it too restrictive.
Before you sign a document containing a restrictive covenant, you should consult with an attorney who has knowledge and experience in this area. The lawyers of Deutsch Atkins & Kleinfeldt, P.C. are experienced employment litigation attorneys who can provide the advice you need regarding non-compete agreements.
Neil H. Deutsch has been practicing law for over 35 years and is known as a skilled negotiator in employment and discrimination law. He believes in a bottom-line approach of risk analysis and cost effectiveness for his clients. "Case evaluation is something we take seriously," says Mr. Deutsch who seeks top net dollar for his…
Bruce L. Atkins is regarded as one of New Jersey’s premier practitioners of employment and civil litigation. He has been selected to the New Jersey Super Lawyers prestigious list every year since 2005. This honor, bestowed upon a recipient by the votes of his peers, is a powerful nod to the skill Mr. Atkins brings…
Adam J. Kleinfeldt joined Deutsch Atkins & Kleinfeldt, P.C. in March of 2015. He primarily represents individuals in employment litigations such as discrimination, retaliation, and whistle blowing matters. He has extensive experience in all phases of the litigation process. Adam has obtained significant results for some of his clients, including a $525,000 jury verdict in…
Diane Englander Peyser joined Deutsch Atkins & Kleinfeldt, P.C. in September 2018 where she represents employees in wrongful termination, retaliation, harassment, and discrimination matters. Prior to joining Deutsch Atkins & Kleinfeldt, P.C., Diane represented clients in all aspects of employment law on behalf of employees involving unemployment appeals, claims of sexual harassment, LGBT discrimination, disability…
Debra M. McGarvey joined Deutsch Atkins & Kleinfeldt, P.C. in December 2019. She has extensive experience defending employees and employers in state and federal court in employment litigation matters. She has represented clients on various issues arising out of the New Jersey Law Against Discrimination (NJLAD), the New Jersey Conscientious Employee Protection Act (CEPA), the…
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