Question: Are “employee covenants” enforceable? My employer wants me to sign a lengthy covenant that specifies many obligations on my part, including non-compete and non-solicitation clauses that last for 12 months post-employment. However, it provides nothing in return, other than keeping my current job. Is this legally binding?
New York, New York
Answer: In almost every state – other than California – “restrictive covenants” are legally binding and enforceable. It’s very sad, but using a non-compete or non-solicit agreement such as yours, employers can make life literally miserable for employees who leave or are asked to leave. They can make it difficult to find work, and difficult to stay in a job in the same industry.
You are wise to note that you are getting nothing in return for signing this agreement, other than keeping your job. Unfortunately, the laws in most states (including your state, New York) views keeping your job sufficient benefit in return – what we lawyers call “consideration” – to make the agreements enforceable.
We suggest a “Three-R” approach: Try to (1) Resist, (2) Reduce, (3) Restrict. This approach is fully explained in a past SkloverWorkingWisdom Newsletter that you can find on our Blogsite Library. For someone in your shoes, it is highly recommended reading.
Perhaps one of the most vexing situations at work is when you are asked to sign a Non-Competition Agreement, and you really don’t want to. How can you respond? How should you respond? Our “Model Letter: Response to Request You Sign a Non-Compete” shows you “What to Say, and How to Say It.™ To obtain your copy, just [click here.] Delivered by Email – Instantly!
Sorry for the bad news. Like bad weather, bedbugs and telephone solicitations, non-competes are a seemingly unavoidable pain in the assembly.
Best, Al Sklover
© 2009 Alan L. Sklover, All Rights Reserved.