Updated October 16, 2023
A Pennsylvania non-solicitation agreement is a contract between an employer and an employee that restricts the employee from soliciting business from the employer’s customers following termination of employment. These contracts pertain to a specific timeframe and geographical area.
Is It Legally Enforceable in Pennsylvania?
Yes — non-solicitation agreements are legally binding in Pennsylvania but with limitations.
The court balances the employer’s business interests against the employee’s interest in earning a living and the interest of the public before deciding whether to enforce the agreement. (Hess v. Gebhard & Co., Inc. (2002))
An agreement that restrains trade is considered unreasonable and unenforceable. (Pittsburg Logistics Sys. Inc. v. Beemac Trucking LLC (2021))
An agreement can only apply within particular parameters of time and space. (WellSpan Health v. Bayliss (2005))
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What Can a Non-Solicitation Agreement Prohibit?
In Pennsylvania, as long as the terms of the agreement are bound by a reasonable timeframe and geographical limit while balancing the interests of the employer, employee, and the public, it can generally restrict a former employee from recruiting, hiring, or poaching the employer’s:
- Former or current clients
- Former or current employees
- Independent contractors
- Business associates, suppliers, etc.
What Should Be Included in the Agreement?
In order to be legally enforceable in a Pennsylvania court of law, a non-solicitation covenant must include the following:
1. Duration
The length of time that the agreement will be enforced must be specified in the contract. Typically, it goes into effect when the employee’s job with the employer is terminated.
2. Geographical Limit
The agreement should specify the area or location where the individual is bound to the restrictive terms. This limitation is generally bound to the city, county, or region where the employer is located.
3. Scope of Prohibited Activities
Providing specificity in what “soliciting” means and whom the individual is restricted from soliciting can be helpful in avoiding confusion or legal scuffle between the two parties.
Related Forms
Pennsylvania Non-Compete Agreement
Download: PDF, MS Word, OpenDocument
Pennsylvania Non-Disclosure Agreement
Download: PDF, MS Word, OpenDocument