EnglishEspañol

How To Draft Quality, Enforceable Non-Compete Agreements in New York

Non-compete agreements in New York help companies protect trade secrets and other proprietary information employees may learn while working for them. And although they are legal in New York, courts will not uphold them if they are not drafted properly. This can be a looming potential threat to your business if you are not careful. Luckily, a knowledgeable business law attorney can advise you on the limits and proper uses of non-competes. Let Rosenbaum & Taylor serve your New York business’s legal needs today.

What is a Non-Compete Agreement?

Also known as a non-competition agreement, these contracts prohibit employees from working for a competitor after leaving a company. By the same token, they also prevent a former employee from opening his or her own competing business. Non-competes typically last for a limited amount of time and apply to a specific geographic area. They may constitute an agreed-upon term in a broader employment contract, or may exist as a standalone contract.

How to Ensure Your Non-Compete is Legal

Non-compete agreements limit the ability of individuals to work, either for themselves or for others. As such, New York courts closely scrutinize these agreements to ensure they are reasonable. To be enforceable, a non-compete must meet these criteria:

  • Be necessary to protect the legitimate interests of the employer
  • Not impose an undue hardship on the employee
  • Not be against the public interest
  • Be reasonable in its time period and geographic scope

Non-competes can be no more restrictive than is necessary to protect the employer’s legitimate interests. Courts will therefore examine these interests along with those of the employee. They will also look at the language of the agreement itself. In some cases, courts have been known to enforce some parts of a non-compete and throw out others. For example, a court likely will not uphold an excessive duration or overly broad geographic limitation.

How to enforce a non-compete

Employers who learn that a former employee has violated a non-compete generally enforce the agreement in one of two ways. They may send a letter to the company that wants to hire the former employee. This letter may notify the employer of the agreement and threaten a lawsuit against the employee. Or, the employer may simply sue the employee and ask a court to order the individual to follow its terms. The lawsuit may demand compensatory damages to make up for the money lost because of the breach. While some businesses use non-competes as a scare tactic, it is important to keep in mind they are enforceable.

How Our Firm Can Help

Rosenbaum & Taylor understands New York law with respect to non-compete agreements. We know how to draft these contracts so they are enforceable in courts. Our firm can assist your company with all matters concerning drafting and executing non-competes. In the event you need to sue to enforce a non-compete agreement, we can assist with that as well.

We can also defend your business against a lawsuit or other adverse legal action concerning these contracts. Anything business law related we can handle, and take some of the pressure off your plate. For New York businesses, having legal defense with respect to non-competes is essential. The state has cracked down on companies for using these contracts in recent years. In particular, New York has targeted businesses for requiring rank-and-file workers to sign non-competes. The state’s goal is to severely restrict these agreements as much as possible.

Rosenbaum & Taylor recognizes the value of these contracts for your business. And we’re here to serve your legal needs. If you have questions about non-compete agreements, or you are facing legal issues over them, reach out to us today.

 

Further Reading...

Get a Free Consultation