Non-Solicitation


A Non-Solicitation clause restricts individuals and organizations from soliciting (a) employees, (b) customers or (c) business opportunities from another company or organization for a period of time. The enforceability of these clauses varies from state to state.

Standard and Alternative Language

Alternative 1
Standard—employees and customers

Non-Solicitation. During the term of this Agreement and for [NON-SOLICITATION PERIOD] after any termination of this Agreement, [Party] will not, without the prior written consent of the [Company], either directly or indirectly[, on [Party]'s own behalf or in the service or on behalf of others], solicit or attempt to solicit, divert or hire away any person employed by the [Company] or any customer of the [Company].

Alternative—employees and consultants

Non-Solicitation. During the term of this Agreement and for [NON-SOLICITATION PERIOD] after any termination of this Agreement, [Party] will not directly or indirectly solicit, induce, recruit, encourage or otherwise endeavor to cause or attempt to cause any employee[ or consultant] of the [Company] to terminate their relationship the [Company][; provided, however, that nothing in this section shall prohibit the use of a general solicitation in a publication or by other means.]

Note: Most non-solicitation provisions cover employees and do not mention consultants.

Alternative—customers

Non-Solicitation. During the term of this Agreement and for [NON-SOLICITATION PERIOD] after any termination of this Agreement, [Party] will not directly or indirectly[, on [Party]'s own behalf or in the service or on behalf of others], partnership, company, corporation or other entity, solicit or attempt to solicit, for the purpose of engaging in competition with the Company:

Serviced. Any person or entity whose account was serviced by [Party] at the [Company]; or

Customer. Any person or entity who is or has been a customer of the [Company] prior to [Party]'s termination; or

Prospect. Any person or entity the [Company] has targeted and contacted prior to [Party]'s termination for the purpose of establishing a customer relationship.

Note: this clause does not contain a time limitation on the period since the person or entity was a customer of the company.

Alternative—business opportunities

Non-Solicitation. During the term of this Agreement and for [NON-SOLICITATION PERIOD] after any termination of this Agreement, [Party] will not directly or indirectly[, on [Party]'s own behalf or in the service or on behalf of others], in any capacity:

Solicit Business. Solicit the business or patronage of any Customer for any other person or entity,

Divert Business. divert, entice, or otherwise take away from the Companies the business or patronage of any Customer, or attempt to do so, or

Terminate Business. solicit or induce any Customer to terminate or reduce its relationship with the Companies.


Analysis

In general non-solicitation clauses are enforceable. Employee Non-Solicitation Agreements: Are They Enforceable? Stephanie A. Bilenker, Larry R. Wood, Jr., Pepper Hamilton LLP, October 14, 2004

But not if they are too broad: Broad Non-Solicitation Clause is UnenforceablePhillip J. Griego & Associates, June 26, 2007

The employee, customer or business opportunity should have a backward time restriction.  Non-Solicitation Clause Without Backward Restriction Unenforceable (Share Corp. v. Momar, Inc.), Kenneth J. Vanko, March 16, 2010