Non-Solicitation Agreement Template

A non-solicitation agreement is a contract that prevents an employee from persuading former clients and coworkers to join them at a new company. It is commonly issued when onboarding new employees, although the contract can be signed at any point after employment begins as long as the necessary consideration is provided.

Overview

• Prevents a person from “stealing” customers or employees away from a company.
• Can exist as a standalone contract or as a clause within a larger form.
• Common in sales and executive teams.

By State

Contents

• By State
• What is a Non-Solicitation Agreement?
  • When to Use
  • Non-Solicitation vs. Non-Compete
  • Importance of Consideration

  What is a Non-Solicitation Agreement?

  

  A non-solicitation agreement is a restrictive agreement that, once signed, bars an employee from poaching a business’s personnel, contractors, customers, or clients after leaving the company. The agreement can be used as a standalone contract or as a clause within a broader agreement, such as an NDA or non-compete.

  When to Use

  Many employers include non-solicitation clauses or standalone agreements in the onboarding process for every employee. While this type of “blanket” protection is technically permitted, many states require non-solicitation agreements to cover a specific business interest. Examples include customer relationships, client lists, and specialized training provided to employees.

  The following are situations in which the agreement can be used:

  • To prevent the owner of a company from taking key employees after a sale or dissolution.
  • To prevent employees with access to confidential client lists from soliciting the clients post-employment.
  • To prevent an employee with a new business from poaching existing staff.
  • To retain employee-createdpatents, trade secrets, and other valuable data (must be established beforehand that all employee-created items are company-owned).

  Non-Solicitation vs. Non-Compete

  Both non-solicitation and non-compete agreements are employment contracts designed to restrict an employee’s ability to disrupt a business’s competitive advantage.

  Of the two, non-compete agreements are considerably more restricting. The form prevents employees from working in a specific industry or with specific competitors following the end of employment. Non-competes will often specify the geographic area it affects (such as a city, state, or another territory) and the length of time the employee will be bound to it (e.g., 2 years).

  Because non-compete agreements directly affect a person’s ability to work and make a living, they are considerably more difficult to enforce in a court of law. Whereas the courts generally favor non-solicitation agreements as they do not interfere with where (or with whom) an employee works following their termination.

  Importance of Consideration

  In order to be enforceable, all contracts must have consideration. Consideration is anything of value provided in exchange for signing a contract. Nearly all state laws consider employment as valid consideration, as long as the form is signed at the time of hiring. Mid-term agreements, which are contracts signed by existing employees, could potentially involve additional consideration, which can come in the form of money, vacation days, or another type of reward or benefit.

  Laws: By State

  Note: Nearly all states require non-compete and non-solicitation agreements to be reasonable. This includes having an explicit purpose, avoiding overly broad terms, and containing limited scope and duration.

  LEGEND:

  • ✓ – Permitted
  • X – NOT Permitted
  • ? – Unclear
  • EMPL? = If Employee Non-Solicitation agreements are permitted in the state
  • CUST? = If Customer Non-Solicitation agreements are permitted in the state

  STATE	EMPL?	CUST?	ENFORCEABILITY	STATUTES
  AL	✓	✓	Restrictive covenants must comply with Alabama statutes.	§ 8-1-190
  AK	✓	✓	No NSA-specific enforceability requirements.	Not applicable
  AZ	✓	✓	Enforceable to protect customer relationships, confidential information, and other trade secrets.	Not applicable
  AR	✓	✓	Enforceability varies between customer and employee non-solicitation agreements.	Not applicable
  CA	?	?	Generally prohibited, but may be enforced in rare instances.	§ 16600
  CO	?	✓	Customer non-solicitation agreements are only enforceable against highly paid workers.	§ 8-2-113(2)(d)
  CT	✓	✓	Must comply with Connecticut’s non-compete laws.	Not applicable
  DE	✓	✓	Enforceable under common law requirements for non-competes.	Not applicable
  FL	?	✓	Must protect customer relationships or other legitimate business interests.	§§ 542.33 – 542.335
  GA	✓	✓	Terms must be reasonable in protecting a legitimate business interest.	§ 13-8-50 & § 13-8-53
  HI	✓	✓	Enforceable if compliant with laws on restrictive covenants.	§ 480-4
  ID	✓	✓	Can only be enforced against “key” employees or contractors.	§ 44-2701 – § 44-2704
  IL	✓	✓	Enforceable if the restricted party earns more than $45,000.	820 ILCS 90/10(b) & (c)
  IN	✓	✓	Enforceable if reasonable and necessary to protect a valid interest.	Not applicable
  IA	?	✓	May be enforced under Iowa common law.	Not applicable
  KS	?	✓	No enforceability requirements mentioned in state statutes.	Not applicable
  KY	✓	✓	Enforceable under Kentucky common law.	Not applicable
  LA	✓	✓	Cannot exceed two (2) years after the restricted party’s termination or departure.	RS § 23:921
  ME	✓	✓	Cannot be executed between two (2) employers.	Not applicable
  MD	✓	✓	Examined like non-competes.	Md. Code, Lab. & Empl. § 3-716
  MA	✓	✓	Must be reasonable as determined by a court of law.	§ 24L(a)
  MI	✓	✓	Enforced less stringently than non-competes.	§ 445.774a
  MN	✓	✓	Enforced less stringently than non-competes.	Not applicable
  MS	✓	✓	Terms must be reasonable.	Not applicable
  MO	✓	✓	Must protect employer interests or last no more than one (1) year.	§ 431.202
  MT	✓	✓	Courts don’t look favorably on restrictive agreements for employees.	§ 28-2-703
  NE	✓	✓	Only applies to customers the employee worked with.	Not applicable
  NV	✓	?	Invalid if the customer/employee initiates contact.	§ 613.195(2)(b)
  NH	✓	✓	The agreement’s terms must be reasonable.	Not applicable.
  NJ	✓	✓	Analyzed as non-compete.	Not applicable
  NM	✓	✓	Must protect employer’s interests.	Not applicable
  NY	✓	✓	Analyzed as non-compete.	Not applicable
  NC	✓	✓	Analyzed as non-compete	§ 75-2
  ND	✓	X	No NSA-specific enforceability requirements.	Not applicable
  OH	✓	✓	Enforceable under common law requirements for non-competes.	Not applicable
  OK	✓	✓	Non-solicitation agreements are enforceable in accordance with state law.	Title 15, § 219A and § 219B
  OR	✓	✓	Specifically excluded from state law requirements; enforced by common law.	§ 653.295(5)(b)
  PA	✓	✓	Non-solicitation generally falls under non-compete common law.	Not applicable
  RI	✓	✓	Specifically excluded from state law requirements; enforced by common law.	§ 28-59-2(8)(i)+(ii)
  SC	✓	✓	Non-solicitation falls under non-compete laws.	Not applicable
  SD	✓	✓	Cannot exceed two (2) years past employment date.	§§ 53-9-8 to 53-9-12
  TN	✓	✓	Non-solicitation falls under non-compete laws.	Not applicable
  TX	✓	Non-solicitation falls under non-compete laws.	§ 15.50, § 15.51, & § 15.52
  UT	✓	✓	Not mentioned in state statutes.	Not applicable
  VT	✓	✓	No NSA-specific enforceability requirements.	Not applicable
  VA	✓	✓	Non-solicitation falls under non-compete laws.	Not applicable
  WA	✓	✓	Analyzed as a non-compete.	Not applicable
  WV	✓	✓	Analyzed as a non-compete.	Not applicable
  WI	✓	✓	Non-solicitation falls under non-compete laws.	§ 103.465
  WY	✓	✓	Non-solicitation falls under non-compete laws.	Not applicable

  Sample Non-Solicitation Clause

  A non-solicitation clause can be added to an existing employment contract to prevent the need to sign two (2) separate agreements. The following is a sample clause that can be customized to the needs of the employer:

  NON-SOLICITATION. Except with prior written consent of the Employer, the Employee shall be prohibited from engaging with any former or current employees, contractors, affiliates, clients, customers, and similar parties of the Owner under which a business relationship has been established for the term of this agreement and _______ months after.

  Related Forms (2)

  Non-solicitation agreements are often paired with the following forms:

  

  Non-Compete Agreement – Prevents departing employees from competing with their employer, whether on their own or through employment with another business.

  

  Non-Disclosure Agreement – A contract that requires recipients of highly confidential information not to disclose what they learned to anyone not permitted.