Non-solicitation agreements (NSAs) are common in employment contracts, particularly for roles involving sensitive client relationships, confidential information, or competitive industries. If you’ve signed one, you might wonder, “Can I break a non-solicitation agreement?” The answer depends on several factors, including the agreement’s terms, applicable laws, and your specific circumstances.
Here’s what you need to know about these agreements, their enforceability, and the potential consequences of breaching one from Levy Goldenberg in Manhattan.
What Is a Non-Solicitation Agreement?
A non-solicitation agreement restricts an employee from engaging in certain competitive behaviors after leaving a company. Typically, these agreements prohibit:
- Soliciting the company’s clients or customers for your own benefit or that of a competitor.
- Recruiting or hiring the company’s employees to join a competing organization.
- Using proprietary or confidential information to undermine the company’s business.
Employers implement NSAs to protect their business interests, but the restrictions must align with legal requirements to be enforceable.
Are Non-Solicitation Agreements Enforceable?
The enforceability of a non-solicitation agreement varies by state. Courts consider whether the agreement is:
- Reasonable in Scope: The restrictions should be limited to a specific geographic area, timeframe, and business activity.
- Protecting Legitimate Interests: Employers can use NSAs to safeguard trade secrets, proprietary information, and customer goodwill. However, they cannot unreasonably restrict an individual’s ability to earn a living.
- Consistent with Public Policy: Some states, such as California, generally disfavor restrictive covenants, making non-solicitation agreements difficult to enforce.
If the agreement is overly broad or lacks legitimate justification, courts may deem it unenforceable.
Can You Legally Break a Non-Solicitation Agreement?
Breaking a non-solicitation agreement may be possible under certain circumstances, such as:
- The Agreement Is Unenforceable: If the contract fails to meet enforceability standards, it might not hold up in court. For example, a judge may invalidate it if it restricts activities unrelated to the company’s interests or is excessively long.
- The Employer Breached the Contract: If your employer violated other terms of your employment agreement, it might void the non-solicitation clause.
- Consent or Waiver: Employers may agree to release you from the agreement, especially if circumstances have changed or it no longer serves their interests.
- Legal Challenges: You can challenge the agreement in court, arguing that it is overly restrictive or unenforceable under state law. Courts often modify or invalidate non-solicitation clauses deemed unreasonable.
Risks of Breaking a Non-Solicitation Agreement
If you violate a valid and enforceable non-solicitation agreement, your former employer may take legal action, leading to:
- Injunctions: Courts may issue orders preventing you from soliciting clients or employees.
- Damages: You could be held liable for financial losses incurred by the employer due to the breach.
- Reputational Harm: Legal disputes can damage your professional relationships and future career prospects.
To avoid these risks, consult with an attorney before taking any action that might violate the agreement.
Tips for Navigating Non-Solicitation Agreements
If you’re bound by a non-solicitation agreement, here are some strategies to protect yourself:
- Understand the Terms: Review the agreement carefully to understand its scope, duration, and restrictions. Ambiguous language may work in your favor during a legal dispute.
- Document Employer Violations: If your employer has breached other aspects of your contract, document the details. This information could be crucial if you need to challenge the agreement.
- Seek Legal Counsel: An experienced employment attorney can assess the enforceability of your agreement, provide advice on compliance, and represent you in negotiations or litigation.
- Negotiate Modifications: Before leaving your job, consider discussing modifications to the agreement with your employer. They may agree to narrower, less restrictive terms.
- Comply Until Resolved: Avoid violating the agreement until you have legal clarity. Prematurely soliciting clients or employees could lead to costly consequences.
Navigating Non-Solicitation Agreements: Know Your Options
Breaking a non-solicitation agreement is a complex decision that depends on the agreement’s enforceability and your circumstances. While these agreements are designed to protect businesses, they must be reasonable and lawful. If you’re considering breaking a non-solicitation agreement, consult a legal professional to evaluate your options and mitigate potential risks.
At Levy Goldenberg LLP, our experienced Manhattan attorneys can help you navigate the complexities of non-solicitation agreements. Whether you need advice on compliance, negotiation, or litigation, we’re here to protect your interests. Contact us today to schedule a consultation.
