In New York, if an employee works for any of the big companies, especially in banking, pharmaceuticals, sales, or technology, they’re required to a sign non compete agreement, but are these agreements truly enforceable?

Companies commonly use non compete agreements to protect their intellectual property and trade secrets, keep their clients, and prevent loss of employees to competitors, but it can, in many cases, be overly restrictive and unfair to their employees. In what cases will a court enforce a non compete agreement?

A New York court will likely enforce a non compete agreement if it is found to be reasonable, meaning:

The scope of the non compete is narrowly written to protect a company’s assets such as trade secrets, intellectual property, or confidential information.

An employee must have received something such as skills or payment in exchange for the non compete, otherwise it may not be enforceable.

It doesn’t cause any injuries to the public

It doesn’t cause undue hardship on the employee.

They have a reasonable geographic range. This point can be tougher to argue in New York.

It has a reasonable duration. Typically they last just a few months.

In New York, employees have a duty of loyalty to their employers. They must exercise loyalty and good faith during their time under employment. Examples of breaching this duty of loyalty may include an employee competing against their employer or an employee disclosing trade secrets to a competitor.

Not all states uphold non compete agreements. Check with an attorney to learn more about the laws of and restrictions in your state. To learn more, send us a message.