A restrictive covenant agreement, also known as a non-compete agreement, is a legal contract that restricts an employee from working for a competitor or starting their own competing business in the same industry for a certain period of time after leaving their current employer.

In Pennsylvania, the use of restrictive covenant agreements is a common practice among many businesses. These agreements are typically included in employment contracts and are used to protect the interests of the employer by preventing employees from taking their skills, knowledge, and contacts to a competing company.

While restrictive covenant agreements can be beneficial for employers, they can also be restrictive to employees. In fact, the use of these agreements is controversial and has led to numerous legal battles over the years.

Pennsylvania courts have traditionally been reluctant to enforce restrictive covenant agreements, and have generally required employers to show that the agreement is necessary to protect a legitimate business interest, such as a trade secret or confidential information.

In order to be enforceable in Pennsylvania, a restrictive covenant agreement must be reasonable in scope and duration. The agreement must be narrowly tailored to protect the specific business interests of the employer without excessively burdening the employee’s ability to earn a living.

Enforcement of restrictive covenant agreements in Pennsylvania is also subject to a “blue-pencil” rule, which allows courts to strike down any provisions that are deemed to be overly restrictive or unreasonable.

If you are considering entering into a restrictive covenant agreement in Pennsylvania, it is important to consult with an experienced attorney who can help you assess the risks and benefits of such an agreement. Your attorney can also help you negotiate the terms of the agreement to ensure that it is fair and reasonable for both parties.

In conclusion, while the use of a restrictive covenant agreement in Pennsylvania is a common practice among many businesses, it is important to ensure that these agreements are reasonable in scope and duration, and that they are tailored to protect the specific business interests of the employer without unduly burdening the employee’s ability to earn a living. With the help of an experienced attorney, you can protect your business interests while ensuring that your employees are treated fairly.