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Non-solicitation agreements are an essential tool for businesses looking to protect their workforce and customer base from competitive poaching. This article will guide you through what a non-solicitation agreement is, its purpose, who manages these agreements, common use cases, and the key components that should be included in a template. We’ll also cover the challenges of managing these agreements and how Juro can help automate the process.
A non-solicitation agreement is a legal contract between an employer and an employee (or between businesses) that restricts the employee or the other party from soliciting the company's clients, customers, or employees for a certain period after leaving the company. These agreements are designed to protect a business’s interests and maintain its competitive edge by preventing former employees or partners from taking advantage of inside information and relationships.
The primary purpose of a non-solicitation agreement is to safeguard a company's relationships and human resources. Specifically, these agreements aim to:
Non-solicitation agreements are typically managed by the legal, HR, and commercial teams within a company. Each of these teams has distinct roles.
Legal teams draft and review the agreements to ensure they are legally sound and enforceable, while HR teams may implement the agreements as part of the onboarding and offboarding processes and monitor compliance.
Commercial teams might also be involved, to ensure that the agreements align with the company’s business strategy and client management practices.
Non-solicitation agreements are used in various scenarios to protect business interests. Common use cases include:
A non-solicitation agreement template should include the following key elements:
By including these elements in a non-solicitation agreement template, you ensure clarity and enforceability while protecting the interests of both parties involved.
Managing non-solicitation agreements involves navigating several stages, each with potential challenges and pain points.
Addressing these pain points requires a structured approach, clear communication among teams, and the use of tools or systems that facilitate collaboration and streamline workflows. Fortunately, Juro offers these things, and more.
Juro, as an AI-native contract management platform, offers robust features that specifically streamline and automate the creation, management, and execution of non-solicitation agreements:
Juro's AI-native contract automation platform empowers all teams to create, agree, execute and manage contracts up to 10x faster than traditional tools. To find out more, hit the button below to book your personalized demo.
A non-solicitation agreement template is a ready-made contract a business can reuse whenever it needs to stop someone from approaching its clients or poaching its staff. It’s most often signed by employees, but businesses also use it with contractors and partners who get to know their customers.
Often, yes. Many employers include non-solicitation terms in the employment contract from day one, and use a standalone agreement for people who weren’t covered at the start, such as existing staff or contractors. For existing employees, some places require something extra in return, such as a raise or a bonus, before a new restriction is binding.
A non-compete agreement stops someone from working for a competitor or starting a rival business at all. A non-solicitation agreement is narrower, because the person can take any job they like as long as they don’t approach your clients or staff. Courts are usually more willing to enforce the narrower restriction, which is why many employers rely on non-solicitation terms instead.
Usually, if they’re reasonable. Courts in many places look at whether the restriction protects a genuine business interest, such as client relationships, and whether its length and scope go further than needed. Rules vary a lot, and in California, for example, courts usually won’t enforce a clause that stops a former employee from soliciting customers.
Limit it to the clients the person actually worked with or learned about, and the colleagues they managed or worked closely with, over a set period before they left. A clause that covers every customer and every employee in the business is the kind most likely to be struck out. Keep the restriction to a period you can justify, which for most employees is measured in months rather than years.
That depends on the wording. Many agreements only ban active approaches, so a former employee can usually work with a client who seeks them out unprompted, and general advertising doesn’t normally count as solicitation. If you want to block dealing with former clients altogether, the agreement needs to say so, and that wider restriction is harder to enforce.
It’s a sound starting point, but tailor the restricted period and the people it covers to the role, and check how the rules work where the employee is based. For specific legal advice on your contract templates, consult an attorney.
Build the template in Juro once, then let HR generate each agreement from it, filling in the employee’s details and the length of the restriction. If a change in the law means you need to narrow a clause, you update the one template and every new agreement uses the new wording. Signed agreements sit in one place, so you can search them for restriction end dates when someone leaves or a former employee joins a competitor.
Yes. Operator, built into Juro, can draft a new non-solicitation template from your existing employment and commercial contracts, matching your drafting style and the positions you usually take on restricted periods and scope. Your legal team reviews and approves the first draft before anyone uses it, so it reflects your risk appetite.
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