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Under New Jersey non-compete law, an employer can require an employee to sign a covenant not to compete before a worker begins her job or during her employment. Unfair as it sounds, an employee can be fired if she refuses to sign the non-compete even after she spent years on the job. But there are some restrictions on a non-compete agreement. It must be reasonable in time and geographic scope. For example, in NJ a non-compete agreement typically can last as long as 2 years. The geographic scope is much more fact-specific but it is safe to say that the agreement cannot restrict an employee from working for a competitor anywhere in the country.
There is a further limitation in that a non-compete agreement cannot merely prevent competitors from hiring talented workers in the industry. The non-compete must protect a legitimate business interest such as confidential information. Another exception that has been gaining acceptance in the courts is that the employee’s departure must truly present a danger to the former employer. For instance, the employer must show a likelihood that the employee will use confidential information to hurt the company. The so-called “doctrine of inevitable disclosure” appears to be waning. Call one of our NJ Non-Compete Lawyers for a consultation about your NJ non-compete agreement.