As any employment practitioner is aware, the granting of injunctive relief with respect to the enforcement of a restrictive covenant is far from automatic. Thus, it is critically important that the corporate practitioner draft a restrictive covenant to reflect the requirements set forth in New Jersey Law if there is to be any chance of later enforceability. Restrictive covenants with certain parameters, for example, between two and five years, and less than 20 miles are generally enforceable. Most others are generally too broad to be enforceable depending on the industry and circumstances.
Restrictive covenants now affect almost every phase of life in the business world. They are often linked to confidentiality, intellectual property and trade secret agreements, as well. Generally to be enforceable, restrictive covenants cannot be too restrictive. They cannot be so broad as to create a scintilla of doubt as to their enforceability. It is better to have a restrictive covenant of fewer years and a narrower geographic area, and have it enforceable, than to have a broader restrictive covenant which will not be upheld by the courts.
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