Boost Your Business with Electronic Signature Legitimateness for Non-Solicitation Agreement in India

How to eSign a document: electronic signature legitimateness for Non-Solicitation Agreement in India

Hi my name is Steve Parr, I'm a Vancouver business lawyer and today we're gonna take a look at non-competition and non-solicitation clauses. these types of clauses are often found in employment agreements, contractor agreements and also shareholder and partnership agreements so they're very important to understand so a non competition clause is often found in an employment agreement so in that context the employer is prohibiting the employee from competing with the business both for the term of the employment and for a period of time after the employment is over so whether the employee leaves or is fired it doesn't really matter but for a period of time usually six months to a year that employee is going to be prohibited from competing with the business this clause can further be scoped down on a geographic basis so this can only take effect say within the City of Vancouver or within some other parameters so say within 15 kilometers of the company headquarters now the thing that both employers and employees should know about non competition clauses is that they may not actually be enforceable so that is if the contract comes under dispute if somebody alleges that another party has breached than the non competition clause and decides to take them to court and this contract shows up before a judge the judge may not actually enforce that provision and the reason for that is because this type of restriction represents a restraint on trade it's restricting the ability of the employee to go out into the economy and participate in it so restricting their ability to be entrepreneurial or to even join up with another company that is competing in the same industry and the courts don't like those types of restrictions however what's easier to enforce is what's called a non solicitation clause and these clauses work similarly to non competition clauses so the drafting will look something like for the term of the employees engagement with the company and for a period of time thereafter usually six months to a year again although this could be up to two years or even three years the employee is prohibited from soliciting the company's customers its clients it's suppliers other employees other contractors in essence it's saying this employees cannot poach the contacts of the business and this is a much more narrowly drafted restraint so it doesn't actually prohibit the person from going out there and competing with that business they can they can strike out on their own they can do whatever they like but they just can't solicit the customers the employees and all the other business contacts from the original company so that kind of constraint is is looked upon more favorably by the courts so it has a higher chance of being enforceable so for both non competition and non-solicitation clauses if you are considering putting them into your employment agreements or any other type of business agreement that is vital to your business it's essential that you review them with a lawyer first that ideally you have a lawyer draft them because they're very technical and they can turn on recent developments in case law so if you have any other questions about them please feel free to drop a comment below or you can book a consultation with me thanks for watching today and please subscribe you