Restrictive Covenants For Employees In Pennsylvania
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FAQ
In the United States, employers generally use four types of restrictive covenants: (1) covenants not to compete for a certain period of time following the employee's termination from employment (or following a business transaction such as a sale, merger, etc.); (2) covenants not to solicit customers or clients for a ...
Pennsylvania courts enforce non-compete agreements only if they meet these requirements: Legitimate Business Interest: The employer must prove the agreement protects trade secrets, client relationships, or other business interests. Reasonable in Scope: The restrictions must be fair in duration and geographic area.
One of the most common restrictive covenants is not to do or keep anything on the property that could be a nuisance to the neighbouring properties. This is general covenant that could cover a wide variety of actions, to try to keep the area a pleasant place to live.
Are restrictive covenants on property enforceable? Covenants can be unenforceable if they expire, if there is a history of the covenant being violated, or if there is no individual or group benefiting from them. Otherwise, they are generally enforceable and you could face legal action if you ignore them.
In the minority of jurisdictions, like California, courts will likewise disregard the fact that something is labelled as a covenant not to solicit customers and/or clients, and may instead deem it akin to a covenant not to compete and treat it as such.
Assignment to a New Employer: In Pennsylvania, a restrictive covenant not to compete contained in an employment agreement, is confined to the employer with whom the agreement was made, and is not assignable to a new entity which acquires the former employer unless there is specific language permitting assignment in the ...
Non-compete agreements in Pennsylvania are enforceable only if they meet strict standards. Courts may void or modify agreements that are too restrictive. The legal landscape is evolving with state law changes and the FTC's rule potentially banning non-competes.
Pennsylvania courts have generally found non-compete agreements to be enforceable if the agreement is incident to an employment relationship between the employer and employee; the restriction imposed is reasonably necessary for the protection of the employer's business interest; and the restrictions imposed are ...
``In order to enforce a restrictive covenant, an employer must demonstrate that the clause protects one of its legitimate business interests. Secondly, the employer must show that the clause is reasonable, and it only goes so far as is necessary protect a legitimate business interest of the employer.''
