Generally speaking, in New Jersey, a covenant not to compete means that the employee will agree not to work for any of their employer's competitors upon leaving the company. Such agreements are also known by the term "non-compete clauses". An employee who signs a covenant not to compete may receive compensation for the agreement, or in some cases the agreement is a condition for their being hired.

When are Covenants not to Compete Unenforceable?

Knowing in advance whether a judge will enforce an employee's non-compete clause can be hard. Even if the employee's interests may be important New Jersey courts will certainly assign great weight to a person's freedom to choose the type of employment that is suitable for them. Accordingly, only those covenants which are deemed to be reasonable will be upheld by the court. Some agreements that courts have considered to be unreasonable include terms that last for an unusually long period of time or that cover a geographic around Hillsdale that is unreasonably broad.

Covenants must also be limited to restricting dealings with those competitors that are rationally related to the employer's industry. Finally, the covenant not to compete must have a legitimate business purpose which is behind the employer's motivation for requiring the agreement.

Do I Need an Attorney when Dealing with a Covenant not to Compete?

Before you sign any agreements that could restrict your rights, you may consider hiring a Hillsdale, New Jersey attorney who can review the covenant. The attorney can negotiate modifications to the contract if they are needed, and can draft a new clause which is acceptable to the parties involved. A lawyer can also render useful advice for employers who are considering suing an employee for breach of covenant, or they can counsel employees who have signed such an agreement.