For Employees

Non-Solicitation and Non-Competition Clauses: What’s the Difference?

Employees and employers are often confused about the difference between non-competition and non-solicitation clauses.

While the aim of the two clauses may be similar, and although both usually deal with an employee’s rights and responsibilities after employment, the operation of the two clauses is different.

A non-solicitation clause typically restricts or restrains and employee’s ability to contact present, past, or sometimes even prospective clients of the employer. Often it will prohibit an employee from contacting these clients for the purpose of selling them a product or service after the employment has ended. Breaching a non-solicitation clause puts both the employee and any new employer at risk of being sued.

A non-competition or non-compete clause, on the other hand, is typically not limited to specific contacts, but rather restricts an employee after being let go or quitting from engaging in employment competitive to the business of their previous employer. Frequently, non-competition clauses restrict competition for a specific amount of time in a specific geographical area; however, in order to be enforceable, these restrictions must be reasonable. Breaching a non-competition clause puts both the employee and any new employer at risk of being sued.

The above is very general. If you are entering into an employment contract, I urge you to seek legal advice with respect to your particular contract as the wording of your contract may create unique obligations or risks for you.

To obtain legal advice regarding your employment contract or a specific a non-solicitation or non-competition clause, please contact me today.

 

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One Response to “Non-Solicitation and Non-Competition Clauses: What’s the Difference?”

  • Cindy says:

    I’ve only ever dealt with non-compete clause and have not come across non-solicitation clauses before. The latter sounds a bit like duty of loyalty to an employer, while the employee is working for the employer, but this clause obviously would operate after the employment relationship has ended. Thanks for the clarification!