for people to hold a multitude of differ-
ent occupations and work in different
locations throughout a lifetime, corpora-
tions continue to make efforts to protect
business interests even after an employee
leaves their company. Importantly, despite
even the best employee leaving on good
terms, a former employee could poten-
tially become a direct competitor, solicit
clients, and use a company's trade secrets.
Protecting the corporate interest can
depend on the ability to enforce a non-
competition clause.
A non-competition clause, or non-
compete clause, is a restrictive covenant
that endeavors to prevent the employee
from becoming a direct competitor of the
employer upon departure from a company.
Certain restrictive covenants specifically
bind the employee by limiting employee's
ability to work in a certain geographic
location, or for a specified amount of time,
or within a certain field and with certain
clients.
enforceable. In fact, non-compete clauses
are generally unpopular and are met with
reluctance in the court system.
limiting a person's ability to work, thus
it is scrutinized carefully. Corporations
must carefully consider the parameters
of the non-compete clause as too many
limitations on the former employee may
prove ineffective.
To find a non-compete clause valid
and therefore enforceable, New York
courts apply a three-part reasonableness
test. The general rule to determine if
an employee's non-competition clause
is enforceable is if, "(1) it is no greater
than is required for the protection of
the legitimate interest of the employer,
(2) does not impose undue hardship on
the employee, and (3) is not injurious to
the public."
the case specifics before making a
determination of law. To be effective, the
non-compete agreement should mirror this
reasonableness standard.
should outline the corporation's legitimate
business interest. The United States
District Court for the Southern District
of New York has considered that an
employer's legitimate interest is 1)
to prevent disclosure of trade secrets
or employee/client solicitation, 2) to
prevent disclosure of private client
information, or 3) where employee's
skill and service is considered "special
or unique."
covenant is unnecessary and therefore
the non-compete clause is ineffective.
For example, in Last v. New York Institute
of Technology, a doctor signed an anti-
competition clause stating he would not
work within 10 miles of the clinic where
he was assigned to work.
with the clinic, and he remained in the
area seeing patients. Despite signing
an anti-competition clause and still
practicing in the same area, the Second
Judicial Department determined that
City office. She is the founding partner of the Special Education
Practice Group, where she represents children and their families
throughout due process proceedings seeking to secure effective
and appropriate individualized educational services for children.
Her practice also includes the representation of physicians,
healthcare providers, hospitals, individuals and corporate entities
from inception through trial.
Aviles, LLP. Previously, she was a summer scholar at the Nassau
County Surrogate's Court. She was admitted to practice law in
New York in 2014 and in New Jersey in 2013.
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