When it comes to Georgia contract law, poorly drafted non-compete employment agreements have caused severe financial loss and competitive advantage to many businesses. If your business wants to protect its clients, potential customers, and secured information from being used by employees once they leave, then consider the following:
The main reason why non-compete agreements fail in Georgia is because the drafter (attorney) of the agreement simply did not understand the nuances regarding case law in this area and the distinctions between a non-compete covenant, a non solicitation covenant and a non recruitment covenant. Each of those three covenants is given different treatment under Georgia law.
In Georgia, non-compete agreements (covenants) fall under strict scrutiny and that means: if even one clause of your employee’s non-compete agreement is held invalid, the whole agreement is invalid. When determining whether your non-compete agreement is valid, Courts look at the duration of the restriction; the conduct restricted; and the geographical scope of the restriction, amongst other criteria.
However, “non solicitation” agreements are analyzed differently. Because of a 1992 Georgia Supreme Court case, non solicitation agreements (covenants) do not have to specify geographical limits. That’s a vital distinction. But understand: non “solicitation” agreements nevertheless have restrictions and, again, if one of these restrictions is violated, you run a high risk of having your entire non solicitation agreement held unenforceable, invalid.
The Oinonen Law Group offers representation and consultation to businesses, individuals, and attorneys located outside of Georgia regarding the most effective way to draft, uphold, and/or attack non-compete agreements. Call us for effective counsel.