Specifically, a non-solicitation clause limits the employee from taking or attempting take the customers of the employer (or even the employees of the employer).
Not all employees have a non-solicitation agreement. Generally, sales-persons and higher-level managers may have one in their written employment contract, if at all. However, even if an employee does not have one, and that employee is an executive or high level manager, he or she may be bound to an implied non-solicitation duty as a fiduciary. Contact us to determine if you are fiduciary.
Non-solicitation clauses are restraints of trade, meaning they restrict an individual’s ability to work following the end of employment, and as a result, the courts are cautious to approve them. However, unlike non-competition clauses, courts are more open to enforcing non-solicitation clauses to protect the valid business concerns of former employers.
Nevertheless, employers must have carefully crafted their non-solicitation clauses to make sure they remain valid if tested by a court. An enforceable non-solicitation clause should describe how it necessary in the context of the business and the employee’s duties regarding it. Furthermore, the non-solicitation clause should only apply to customers to which the employee already has a relationship. Finally, the non-solicitation clause should be limited in territory and time. For example, an enforceable non-solicitation clause would describe the nature of the business, how the employee plays a role in the business, the customers the employee is expected to work with, who the employee is prevented from working with in the event the employee leaves, and that the employee is only prevented from soliciting customers in southern Ontario and for only 18 months.
Dutton Employment Law is a non-solicitation law firm.
If your employer has asked you to sign a non-solicitation agreement (or a non-solicitation clause in an employment contract), or if you have been threatened with breaching a non-solicitation agreement, contact a Toronto non-solicitation lawyer today. Your employer could launch an injunction to enforce the agreement against you, which would be expensive to defend if not dealt with swiftly.