Restrictive covenants in employment contracts are becoming more and more common. “Restrictive covenants” typically limit an employee’s ability to benefit from an employer’s confidential information or business following the conclusion of the employment relationship. Common restrictive covenants include restrictions on the use of confidential information, anti-solicitation provisions, and non-competition provisions.
Non-solicitation and non-competition provisions may look very similar to one another. The main difference is that non-solicitation provisions restrict a former employee’s ability to interact with customers or clients of the employer. As an example, a non-solicit provision may restrict a former employee from contacting any of her former employer’s customers for a period of two years after the end of the employment relationship.
Non-competition provisions typically restrict a former employee’s ability to work for a competitor of an employer, or even in the same industry. They are usually limited in time and scope. As an example, a non-competition provision may restrict a former employee from working for any competitor of the employer within a geographic radius of ten miles for a period of two years after the end of the employment relationship. Non-competition provisions can be much more onerous and problematic, because they greatly restrict an employee’s ability to earn a living.