Richard, I’m thinking of leaving my job, but the contract I signed has a restrictive covenant. Do I have to worry about that? Are those enforceable?
Thanks, Dr. LAnswer:
The unsatisfying answer is maybe. The enforceability of a restrictive covenant in an employment contract is something that varies by state; in California for instance, they’re not enforceable at all, but in most states it’s a question of reasonableness. Is the restriction reasonable in light of the type of work that you’re doing, the geography of where you work, and the amount of time that it lasts? These are all questions that will determine whether the covenant is enforceable.
But an important thing to remember is that even if a restrictive covenant is ultimately determined to be unenforceable, you still have to go to court to have that determination made, which is costly and time consuming. In some contracts, employers will include clauses stating that in the event of a dispute over the validity of the restrictive covenant, the employee is preliminarily restrained from violating the covenant until the dispute is resolved. This is why it’s never a good idea to sign a contract with a crazy restrictive covenant, even if you don’t think it would stand up in court. It’s much easier to negotiate down the scope of a restriction before you sign than it is to fight its validity after the fact.
For assistance with an employment contract, feel free to contact Jennifer Jennifer@Kirschenbaumesq.com
or (516) 747-6700 x. 302.