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New Jersey Non-Compete Agreement Template

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New Jersey Non-Compete Agreement Template

Updated March 01, 2024

A New Jersey non-compete agreement is legally enforceable to restrict a former employee from working in the same field for a duration and geographical area. An employer may enter into a non-compete to protect its business’s “legitimate interests.” This includes the employer’s customer relationships, trade secrets, and confidential business information.

Legally Enforceable?

Yes, a non-compete in New Jersey is legally enforceable if it follows the “Solari/Whitmyer” test:[1][2]

1. Simply protects the legitimate interests of the employer;
2. Imposes no undue hardship on the employee; and
3. Is not injurious to the public.

Psychologists (exempt)

A licensed psychologist is exempt from entering any agreement that prohibits clients from being able to see their preferred therapist of choice.[3]

Attorneys (exempt)

A licensed attorney cannot participate in offering or making an agreement that restricts their right to practice law after employment termination.[4]

Legitimate Interest

A “legitimate interest” can be described as:[5]

  • Customer relationships;
  • Trade secrets; and
  • Confidential business information.

Customer Relationships

For customer relationships, there must be evidence that “a significant investment of time, effort and money which is worthy of protection.”[6]

However, the New Jersey Superior Court has recently limited the protectable employer’s customers to those only an employee had direct contact with, not all the employer’s customers.[7]

Continued Employment

If an employee is offered continued employment, it will be validated as sufficient consideration for a non-compete.[8]

Maximum Term

3 years has been found legitimate if the geographical area for the non-compete is limited to the city/town where the employer is located.[9]

Blue Penciling

Blue penciling is allowed and lets a court modify and enforce a non-compete to the extent reasonable under the law.


The term “blue pencil[ing]” refers to a court’s modification or tailoring of a restrictive covenant.[7]