New Jersey Clauses Relating to Venture Opportunities, competition
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FAQ
Last week, the New Jersey Assembly's Labor Committee passed bill A3715, designed to sharply limit the available provisions, use, and enforceability of restrictive covenants in employment contracts by New Jersey employers.
In New Jersey, there is no state statute or regulation governing non- competes in employment generally. Non-compete agreements in the legal industry are governed by N.J. RPC 5.6. Non-compete agreements for psychologists licensed by the New Jersey Board of Psychological Examiners are governed by N.J.A.C.
Four states?California, Minnesota, North Dakota and Oklahoma?have banned noncompete agreements entirely, and many other states have enacted restrictions, such as setting a compensation threshold or requiring advance notice.
As a threshold matter, the law explicitly bans the use of non-competes altogether for nine categories of employees; 1) those who are 'non-exempt' under the Fair Labor Standards Act; 2) seasonal or temporary workers; 3) employees who were laid off or terminated without good cause; 4) low-wage employees; 5) undergraduate ...
New Jersey is sometimes referred to as a ?blue pencil state? for restrictive covenants. In effect, this means that courts in New Jersey can modify the terms of a restrictive covenant to make them reasonable and enforceable instead of invalidating them altogether.
New Jersey's Opportunity to Compete Act (also known informally as the New Jersey ?ban the box? law), N.J.S.A. B-11 et seq., goes into effect on March 1, 2015. The new law restricts most employers' ability to request criminal history information from job applicants.
For a non-compete agreement to be enforceable, New Jersey courts require that the non-compete agreement (1) protects the legitimate interests of the employer; (2) does not impose an undue hardship on the employee; and (3) is not injurious to the public.