Scarinci Hollenbeck, LLC
The Firm
201-896-4100 info@sh-law.comFirm Insights
Author: Scarinci Hollenbeck, LLC
Date: April 30, 2013
The Firm
201-896-4100 info@sh-law.comUnder current New Jersey law, enforceable non-compete agreements must strike a balance between protecting the employer’s legitimate business interests with the employee’s right to work in a field for which he or she is trained. In general, courts balance these considerations by examining the type and size of the business, how long and over what geographic area the restrictions apply and whether adequate consideration or benefit, was given the employee at the time the agreement was signed.
Legislation to outlaw certain types of non-compete agreements is currently pending in the New Jersey Assembly. The bill (A-3970), introduced on April 4, 2013, specifically applies to unemployment compensation.
The proposed NJ non-compete legislation would specifically invalidate any covenant, contract, or agreement not to compete, not to disclose, or not to solicit, entered into by an individual with the individual’s most recent employer, if the individual is found to be eligible for unemployment insurance benefits pursuant to New Jersey’s unemployment compensation law (N.J.S.A.43:21-1 et seq.) What is surprising is that non-solicitation and confidentiality restrictions are universally recognized as protecting the legitimate interests of employers.
Being eligible for unemployment benefits as a qualification is not exactly a “high bar” as New Jersey is considered one of the most liberal, give-away states when it comes to unemployment eligibility determinations. The bill does stipulate that the provisions of the bill will not apply to any covenant, contract, or agreement in effect on or before the date of the bill’s enactment. This will have only a limited duration as a qualification, however.
Although it is unclear if this legislation will advance, it appears to have some support in both the Assembly and the Senate. Therefore, New Jersey companies should keep it on their radar. Since the bill would not apply retroactively, it may be necessary to execute agreements in advance of the law’s effective date. Even better, employers should contact their legislative representatives and let them know that they oppose this change.
If you have any questions about the proposed legislation or how it may impact your operations, please contact me, Gary Young, or the Scarinci Hollenbeck attorney with whom you work.
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Secured transactions form the backbone of a wide range of business dealings, including business loans, mortgages, and inventory financing. Because the stakes are often high and relatively minor oversights can have drastic consequences, lenders and borrowers should thoroughly understand how to form an enforceable security agreement that protects their legal rights. What Is a Secured […]
Author: Dan Brecher
Cashing a check marked “paid in full” can be a risky endeavor, particularly if you don’t fully understanding the legal implications. If you are owed more than the amount of the check you accept and deposit, you may waive your right to collect the full disputed amount. That is why you should consider either rejecting […]
Author: Dan Brecher
The One Big Beautiful Bill Act of 2025 (OBBBA) significantly impacts federal taxes, credits, and deductions. A key change relating to Qualified Small Business Stock (QSBS) allows greater tax-free gains for investments in startups and other qualifying small businesses. Company founders and other investors should understand how the enhanced tax strategy works or risk missing […]
Author: Dan Brecher
Corporate consolidation involves two or more businesses merging to become a single larger entity. The result is often a stronger and more competitive company that can better navigate today’s competitive marketplace. What Is Corporate Consolidation? Corporate consolidation closely resembles a basic merger transaction. The primary difference is that a consolidation creates an entirely new business […]
Author: Dan Brecher
Business law plays a critical role in nearly every aspect of running a successful enterprise, from negotiating a commercial lease to drafting employee policies to fulfilling corporate disclosure obligations. Understanding what is business law and your legal obligations can help your business run smoothly and build productive relationships with clients, business partners, regulators, and others. […]
Author: Dan Brecher
Corporate transactions can have significant implications for a corporation and its stakeholders. For deals to be successful, companies must act strategically to maximize value and minimize risk. It is also important to fully understand the legal and financial ramifications of corporate transactions, both in the near and long term. Understanding Corporate Transactions The term “corporate […]
Author: Dan Brecher
No Aspect of the advertisement has been approved by the Supreme Court. Results may vary depending on your particular facts and legal circumstances.
Consider subscribing to our Firm Insights mailing list by clicking the button below so you can keep up to date with the firm`s latest articles covering various legal topics.
Stay informed and inspired with the latest updates, insights, and events from Scarinci Hollenbeck. Our resource library provides valuable content across a range of categories to keep you connected and ahead of the curve.
Let`s get in touch!
Sign up to get the latest from the Scarinci Hollenbeck, LLC attorneys!