Can I require employees to sign non-compete agreements in New Jersey? What are the requirements?

Non-compete agreements are generally enforceable in New Jersey, but there are certain requirements that must be met.

Requirements for Non-Compete Agreements in New Jersey

1. Legitimate business interest: The non-compete agreement must protect a legitimate business interest, such as trade secrets, confidential information, or customer relationships. ^[2.2]
2. Limited in scope: The non-compete agreement must be reasonable in scope, duration, and geographic area. It cannot be broader than necessary to protect the legitimate business interest. ^[2.2]
3. Notice and consideration: The employee must receive notice of the non-compete agreement before or at the time of the initial offer of employment, or at least 30 days before the agreement is signed. The employee must also receive consideration, such as a job offer or a promotion, in exchange for signing the agreement. ^[2.2]
4. No undue hardship: The non-compete agreement cannot impose an undue hardship on the employee, such as preventing them from finding work in their field. ^[2.2]

It is important to note that certain positions, such as those in law enforcement, corrections, the judiciary, homeland security, or emergency management, may be exempt from the requirements of non-compete agreements. ^[2.3]

Conclusion

In summary, non-compete agreements are generally enforceable in New Jersey if they protect a legitimate business interest, are limited in scope, provide notice and consideration to the employee, and do not impose an undue hardship. However, certain positions may be exempt from these requirements. It is important to consult with a legal professional to ensure that any non-compete agreement complies with New Jersey law. ^[2.2][2.3]

Source(s):

• [2.2] Violations
• [2.3] Exemptions

Jurisdiction

New Jersey

• Labor