The validity of a non-compete agreement in New York is measured in light of relevant principles and the particular facts and circumstances surrounding your business.
Non-compete clauses are commonly found in employment agreements across many industries regardless of size or products / services offered. Non-compete agreements impose restrictions on future employment of employees. The validity of a specific non-compete clause is taken on a case-by-case basis via courts in New York. New York courts shall, generally, consider what is reasonable. Those non-compete agreements that are considered “reasonable” are agreements with:
- The non-compete clause is no broader than is required to protect the NY business’s legitimate business interests;
- The non-compete clause does not unduly burden the employee;
- The non-compete clause does not injure the public;
- The non-compete clause is not for an unreasonable duration of time; and
- The non-compete clause has a reasonable and limited geographic scope.
If an employee to a non-compete clause or agreement breaches the agreement your your NY business has two court options. You company can seek an injunction via an Order to Show Cause to enforce the non-compete clause and prevent the employee from engaging in the behavior at issue, or seek money damages, should the behavior at issue result in loss of profits to your business. In many cases, both choices are advisable. We, normally, draft a demand letter prior to engage in litigation. The demand letter can be sent, in many cases, to the new employer and the former employee.
Because of this highly subjective nature of New York’s non-compete law, it is imperative that you consult an experienced New York attorney so that you can analyze what positions in your NY business are key to your operation, what interests and information must be protected, and the best way to craft your non-compete clause or agreement. Don’t just pull an agreement off the internet.
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