One challenge that business owners face is when former employees steal customers or convince current employees to come with them to a new job. This kind of employee recruitment and client theft is known as soliciting, and there are ways to combat it.
If you want to make sure those leaving your company do not damage your business, talk to an Alpharetta non-solicitation agreements lawyer at Sparks Law. Our experienced attorneys can draft employment contracts that protect your business interests and prevent future problems from disgruntled workers.
At hiring, employees are usually presented with company rules, including restrictions in the event that they leave the job. These restrictions are often woven into employment agreements, but they could also be included in separate documents or in an employee manual.
Georgia employment law recognizes four restrictive covenants:
Former employees who had material contact with customers cannot solicit them for a new employer or for themselves, if they charter their own business. Former employees also cannot passively accept business from former employers’ customers if they knew them. For example, if a service technician attends to customers’ swimming pools in Alpharetta and then opens a similar business, former customers that she serviced would be off-limits. However, customers the technician did not service may be fair targets.
Importantly, non-solicitation clauses must balance the needs of both the former employer and the former employee. The courts have decided that a reasonable restriction to soliciting customers and clients is no more than two years. Our local attorneys can review your restrictive covenants to ensure that any non-solicitation clauses will be enforceable in court.
Over the years, there have been several changes to the Georgia laws regarding restrictive covenants. In 2011, Georgia revised its laws on non-compete, non-disclosure, and non-solicitation of customers. A 2017 Court of Appeals decision altered how Georgia businesses handle non-solicitation of employees. Prior to the appeal, the court had ruled in favor of a former employee who was sued by their former employer for recruiting other employees. The court ruled for the employee because the restrictive covenant was not limited to a geographic area and did not limit non-solicitation to the former coworkers that they knew.
However, in CMGRP, Inc. v. Gallant, No. A17A1168 (Ga. Ct. App. Oct. 4, 2017), the Georgia Appeals Court reversed the lower court’s decision and established that former employees could not recruit any other workers, not just the ones they knew or had contact with. The Court also established that a geographic limitation is not necessary for an employee non-solicitation clause to be enforceable. This means that a former employee cannot solicit employees from other company branches that may be in distant locations.
Although this case serves as a precedent when drafting non-solicitation language, the outcome has not been adopted into statutory law. A former employee could still challenge non-solicitation clauses if they are not precise. As such, business owners should speak with a lawyer at our firm as the best source for effective non-solicitation clauses. A knowledgeable attorney at our Alpharetta office can further explain these recent updates and how they may affect your non-solicitation agreement.
All business owners hope for a smooth transition when an employee leaves the company and gains employment elsewhere. One tool you can use to ensure this is a non-solicitation agreement, which stops former employees from stealing your workforce and customers.
To secure the success of your business, speak to an Alpharetta non-solicitation agreements lawyer at Sparks Law. Give us a call today to discuss how we can draft contracts that suit your needs.