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Delaware Non-Solicitation Agreement

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Delaware Non-Solicitation Agreement

Updated October 16, 2023

A Delaware non-solicitation agreement is a contract that prevents an employee from poaching their employer’s clients, employees, or contractors after leaving the company. Similar to non-compete agreements and NDAs, a non-solicitation agreement can be a stand-alone document or included as a clause in an employment contract. 

Is It Legally Enforceable in Delaware?

Yes. Non-solicitation agreements are enforceable if they:

  • Meet general contract law requirements
  • Are reasonable in scope and duration
  • Advance a legitimate economic interest of the employer
  • Balance the interest of the employee and the public

Non-solicitation agreements involving employment contracts are more closely scrutinized than those involving the sale of stock. (Tristate Courier and Carriage, Inc. v. Berryman, C.A. No. 20574-NC (Del. Ch. Apr. 15, 2004))

Table of Contents

What Types of Solicitation Can Be Prohibited?

In Delaware, a non-solicitation covenant can restrict a party from contacting the employer’s:

  • Past or current clients and customers
  • Past or current employees
  • Past or current contractors
  • Other business relationships (e.g. supplier, affiliates, etc.)

What Should Be Included in the Agreement?

What should you include in a non-solicitation agreement.

Based on the state’s case law, a non-solicitation agreement must include the following in order to hold up in a court of law:

1. Time Limit

The duration of the covenant, which typically begins at the termination of employment, must be specified in the agreement. The length of time must be considered reasonable and fair to the interests of the employee, employer, and the public.

2. Geographical Limit

The terms of the agreement should apply to a specified geographical area that is reasonable and fair to the interests of the employee, employer, and the public.

3. Restricted Action

The covenant should outline the specific parties that the employee is prohibited from soliciting. This can range from particular clients or employees to an all-encompassing list. The scope of the restricted action should be considered reasonable and fair to the interests of the employee, employer, and the public.

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