Enforceability of Non-Competition Agreements in Virginia

In general, non-competition agreements will be strictly construed against employers. These agreements must be as narrowly drafted as possible to protect the vital interests of the employer. If the agreement is too broad or vague, it is unlikely that a court will enforce the agreement.

When enforceability is challenged, Courts in Virginia will review the non-competition agreement from three different perspectives:

  1. From the standpoint of the employer, is the restraint reasonable?  Meaning, is the restraint no greater than necessary to protect the employer in some legitimate business interest?
  2. From the standpoint of the employee, is the restraint reasonable in the sense that it is not unduly harsh and oppressive in curtailing the employee’s legitimate efforts to earn a livelihood?
  3. From the standpoint of sound public policy, is the restraint reasonable?

Courts will also review terms such as geographical limitation, time limitation, and scope of the limitation to determine reasonableness, and therefore enforceability.  With so many variables in the mix, it’s no wonder many employers are unable to walk the fine line between enforceability and non-enforceability.

The case of Edward Jones’ $42 million in lost assets resulting from former employee Samuel Clyburn’s solicitation, showcases the serious consequences that can result for an employer if an employee breaches a non-solicitation agreement, or if a non-solicitation agreement is found to be unenforceable. Employers, particularly those in the financial sector, may wish to consider having their employment agreements reviewed to ensure the enforceability of similar non-solicitation provisions.

Our attorneys at General Counsel, P.C. have experience in walking the fine line of protecting a wide range of employer interests, while still remaining narrow enough to be enforceable.

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