The more restrictions employment contracts impose on individuals, the greater the risk of their violating an agreement later. Employment contracts help protect against the possibility of misconduct with economic consequences in the future.
Businesses have long relied on noncompete agreements to protect trade secrets and prevent workers from taking jobs with competing organizations. Scrutiny of noncompete agreements in recent years has led to many companies pivoting away to different types of restrictive covenants.
Non-solicitation agreements can be valuable when hiring new workers or promoting existing ones. If an employee leaves the company and violates a non-solicitation agreement, then the former employer may need to pursue litigation as a means of resolving the matter.
How can a non-solicitation agreement protect a business?
Non-solicitation agreements help prevent infringing economic activities that could diminish a company’s profitability or impact daily operations. Frequently, the main priority of a non-solicitation agreement is to prevent a worker from taking a job elsewhere and then luring away their co-workers to work for the same company. Non-solicitation agreements also apply in scenarios where employees start their own businesses after leaving a job. Occasionally, non-solicitation agreements may apply to clients or customers if workers have access to lists of those who do business with their employers.
What does enforcement require?
Generally speaking, the non-solicitation agreement must comply with the law to be enforceable in civil court. There needs to be reasonable restrictions on how long the agreement remains enforceable and the area to which it applies.
Provided that an agreement is enforceable, the business pursuing litigation usually needs to show that a former employee directly violated the agreement. They need evidence of clients leaving the company to do business with a former employee or their current employer. Other times, records of employees switching their current employer on social media platforms can help show that one worker who left their job then violated the non-solicitation agreement, maybe because of a referral bonus.
If an employer has a valid contract with a worker and proof that violations have likely occurred, then it may be possible to ask the courts to uphold any penalty clauses included in the non-solicitation agreement. Plaintiff organizations can seek damages. They can also ask the courts to issue an injunction to prevent additional infringement.
Reviewing the conduct of a former worker who may have breached their employment contract with a skilled legal team can help prevent long-term damage to a business. Companies may need support while analyzing and enforcing restrictive covenants after workers leave a company for opportunities elsewhere, and that’s okay.