Loading...The Pennsylvania non-compete & non-solicitation agreement is intended to prevent employees from engaging in specific activities both during and following their employment. An employer may ask an employee to sign the contract as a means to restrict them from operating with similar businesses that directly compete with the employer. The agreement also prohibits employees from soliciting customers, other employees, or independent contractors working for the company. In order for the contract to be enforceable, the employer must show that reasonable consideration was offered to the employee before the document was signed. According to the case of Socko v. Mid-Atlantic Systems of CPA, Inc., the courts found examples of valid consideration to be the start of new employment or a valuable benefit such as an increase in wage or a promotion.
Laws – No statutes, though Pennsylvania case law has shown the following limitations to be valid:
Non-Compete Limit (see below)
- Geographical Limitations – A ten (10) mile radius was enforced (Aamco Transmissions v. Romano, Civil Action No. 13-5747, E.D. Pa. 2016)
- Limits – A two (2) year period was enforced, a one (1) year period was deemed reasonable.
- Two (2) years was enforced by the courts (Aamco Transmissions v. Romano, Civil Action No. 13-5747, E.D. Pa. 2016)
- One (1) year was deemed reasonable by the courts (Bettinger v. Carl Berke Association, 314 A.2d 296, 298 (Pa. 1974))
Non-Solicitation Limit – Two (2) years was enforced (Metalico Pittsburgh, Inc. v. Newman)