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Non-Compete Agreements Getting Harder to Enforce?

Posted by Frank Steinberg | Sep 30, 2008 | 0 Comments

A recent article in Lawyers  USA (subscription required) suggests that it may be getting harder for businesses to enforce non-compete agreements as the economic downturn makes courts reluctant to limit workers' opportunities for employment.

A recent California decision has expanded the protection given workers under a state law that voids every contract that restrains anyone from engaging in a business or profession.

Oregon recently enacted a law that requires employers to notify prospective employees in writing, at least 2 weeks' before employment starts, that they will be required to sign a non-compete.

The article cites other examples of the trend.  Can the same be said of New Jersey?  The Garden State is one of the states that traditionally has enforced non-competes.  While we do not foresee a significant change in the expression of the law, these cases are decided on a case by case analysis of the facts, and it seems clear that courts are requiring employers to demonstrate concretely how they will be harmed if a non-compete is not enforced.

It's an issue that may get increasing attention if  the economy worsens and unemployment rises. 

About the Author

Frank Steinberg

Frank is the founder and principal of Steinberg Law, LLC. A Jersey boy born and bred, he focuses on employment litigation and counseling, business litigation,  and aviation law. Following law school and a clerkship in the federal district court Frank spent his early career with large litigation ...

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