Appropriate use of non-solicitation agreements

On Behalf of | Apr 21, 2020 | Non-Solicitation Agreements And Restrictive Covenants |

It is not uncommon for companies to have their employees sign contracts that attempt to protect their confidential information or business strategies and plans. These contracts may include nondisclosure agreements, also called confidentiality agreements. Depending on a person’s role, they may also be asked to sign a non-solicitation agreement. This type of contract is frequently used with sales professionals.

The purpose of a non-solicitation agreement

As explained by the Houston Chronicle, a non-solicitation agreement’s purpose should be to prevent a sales representative from leaving one company and then actively using knowledge or contacts gained there against that company. One example of this behavior includes a salesperson taking a job at a like company operating in the same market and geography and calling directly on the same customers in an attempt to lure them away from the first company to the second company.

Social media and non-solicitation agreements

According to Corporate Wellness magazine, professional networking and social media sites may expose some gray areas when it comes to adherence to or violation of a non-solicitation agreement. It is quite normal and understandable for a person to update their profile to reflect a change of employment. However, some employers may feel that doing so broadcasts to potential customers a change that could make their company vulnerable. Employees, for their part, often assert that companies overstep their bounds with these agreements.

Clarity essential in contract verbiage

All non-solicitation agreements should be clearly worded so as to avoid ambiguity and, ideally, conflicts. For example, a contract may make a distinction between updating work status and actively reaching out to contacts to solicit business.