Nonsolicitation

Nonsolicitation refers to contractual provisions that prohibit a party from soliciting certain relationships, typically employees or customers, in connection with an ongoing or ended business relationship. Nonsolicitation clauses may target specific individuals or classes (such as “all employees of Company X”) and cover either employees, customers, clients, suppliers, or business partners. They are commonly included in employment agreements, consulting arrangements, and mergers or acquisitions where the buyer seeks to protect the value of the business.

Enforceability varies by jurisdiction. Courts generally require restraints to be reasonable in duration, geographic scope, and the activities restricted, and to protect a legitimate business interest such as retaining talent or preserving customer relationships. Nonsolicitation of employees in ordinary employment contexts is treated differently from broad restrictions on employee mobility, and some jurisdictions impose strict limits. California, for example, disfavors non-solicitation of employees outside of specific business-sale contexts, while many other states apply more flexible tests to protect legitimate interests in a sale, acquisition, or competitive conduct.

Common elements and drafting considerations include defining who is covered (named individuals or classes), what constitutes solicitation (direct contact, indirect encouragement, or actions that create the impression of an opportunity), duration, geographic scope, and exceptions for general advertising. Clauses often specify whether general solicitations are allowed and may carve out non-targeted outreach. Consider mutuality, impact on existing relationships, and alignment with other restrictive covenants.

Remedies for breach may include injunctive relief and damages; some agreements provide liquidated damages. Nonsolicitation is distinct from confidentiality and non-compete covenants, though they may be used together to protect business interests.