New York Covenants
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FAQ
How do I challenge a restrictive covenant? Express release: It may be possible to negotiate the release or variation of a restrictive covenant. Indemnity insurance: It is possible to obtain indemnity insurance to protect against the risk of a person with the benefit of a restrictive covenant seeking to enforce it.
Common Mistakes Companies Make with Non-Compete Agreements The agreement is not enforceable because the time period it covers is too long. The period considered reasonable varies by state but typically ranges from 6 months to two years. Longer agreements will likely be found invalid.
In New York, a restrictive covenant is considered enforceable if the employer can show that: (1) the restriction is no greater than what is required to protect the employer's legitimate interest, (2) the restriction does not create an undue hardship for the employee, and (3) the restriction does not harm the public.
A deed is a formal document conveying an interest in real property from one party to another. A covenant is most typically going to refer to a condition that is part of either of those transactions, such as a contractual covenant not to compete or a deed covenant to use property in a certain way.
Non competes are enforced only when necessary to protect legitimate business interests such as trade secrets or special skills acquired during employment. non compete agreements must be reasonable in time and geographic reach.
It provides that a restrictive covenant is reasonable, and thus, enforceable, if: (1) its terms are no greater than is required to protect the employer's legitimate business interest; (2) it does not impose undue hardship on the former employee; and (3) it is not injurious to the public.
Certain restrictive covenants are illegal and void under existing law and the California Fair Employment and Housing Act.
You can make a covenant by completing the Deed of Covenant Form for Individuals (pdf). You can also ask a professional adviser such as a solicitor or accountant to make a deed. The deed must be properly drawn up, signed, witnessed, sealed and delivered to the covenantee.
