Even for employees who remain subject to restrictive agreements after termination of employment, A3715 would impose a number of restrictions on agreements that weigh in favour of the employee. Among the most important: an employee`s non-compete obligation would be limited to a maximum of 12 months from the date of termination of the employee`s employment, whether or not the employee`s role could justify a longer period; An employer would be required to disclose the terms of its non-compete obligation to any prospective employee in writing at the time of a formal offer of employment or at least 30 business days prior to the commencement of employment. and the employer would be required to inform the employee in writing within 10 days of the termination of the employment relationship of its intention to enforce the non-compete obligation, with the agreement automatically becoming invalid if the employer fails to do so. At least one New Jersey court has suggested that a non-compete clause is unenforceable if an employee loses their job because the employer violates an employment contract or harms the public interest. Nor can a non-compete obligation or other restrictive agreement harm the public. For example, restrictions on physicians in patient care are often subject to increased judicial scrutiny, as restricting patients` ability to receive medical care from the physician of their choice is important public policy. Lawyers cannot be limited by non-competition clauses because our law recognizes a person`s right to a lawyer of their choice. New Jersey`s law on enforceability of a non-compete agreement and entering into a non-compete obligation is very fact-sensitive. Overly broad and/or punitive agreements are generally unenforceable. While New Jersey subscribes to the “blue pencil doctrine” (below and on our previous page titled “Competition Against Your Employer: Is It Allowed?”), a court will circumscribe a restrictive agreement with less restrictive effects on the employee, but agreements that go too far may be overturned. Many times, our New Jersey labor attorneys are able to negotiate an out-of-court settlement with their former employer on behalf of the employees that allows the employee to remain employed and continue to subsist while protecting the legitimate business interests of the former employer.

If you have a non-compete clause or other restrictive agreement, please contact our law firm Holmdel to speak with one of our non-competition clauses about the specific facts and circumstances of your restrictions after termination. Each non-compete obligation is different and requires an experienced New Jersey labor lawyer to review and analyze the terms to determine whether the restriction is enforceable or unenforceable. If you have a non-compete obligation and would like an attorney to review and advise you on the likelihood of it being enforceable, please contact one of our attorneys in New Jersey to schedule a consultation. New Jersey has recently joined a growing number of states that have made legislative efforts to significantly limit the enforceability of restrictive post-employment agreements, such as non-compete and non-solicitation agreements. In particular, if AB 3715 is adopted in its current form, employers will be required to provide former employees with their full salary and benefits, while restrictions remain in place after termination of employment. This arrangement is known in the UK as a “garden holiday”. and refers to the idea of giving the employee who leaves the time to take care of a garden. AB 3715 would create a myriad of barriers for employers, require additional procedural steps for businesses, and thwart efforts to adopt common business practices. What do you need to know about this pending legislation? Employers` conclusion: If adopted in its current form, A3715 will essentially eviscerate the use of non-compete and non-solicitation in New Jersey.

The law goes far beyond the prophylactic measures of our neighboring states, creates significant economic uncertainty, and will certainly affect New Jersey`s competitiveness. We will be following this bill closely in the Legislative Assembly. Since employers typically draft non-compete clauses, they are usually extremely broad and unfair to the employee. For example, they may prohibit you from working in your field or industry for an unreasonably long period of time, from defining “competition” too broadly, or from covering too large a geographic area. Once the existence of a non-compete obligation or other restrictive agreement has been established, the next investigation is whether the employee breached the agreement in his or her activities after termination. This is a fact-sensitive investigation that requires a comprehensive review of the employee`s duties with the previous job, the terms of the agreement, and an analysis of the employee`s work obligations with the new employer. An employer cannot restrict an employee`s activity after termination unless it can prove that it has a binding contract prohibiting such activities, or can prove that the employee breached its fiduciary duty during employment. This may be the case if an employee starts working for a competitor while working with the former employer or has stolen confidential documents and uses them against the former employer. These cases may give rise to claims for unfair competition, breach of fiduciary duty, abuse of loyalty or other criminal acts for theft. In both New York and New Jersey, non-compete obligations are designed to protect trade secrets and confidential employer information, giving the company time to recruit and train a replacement.