Are contract-based non-solicitation of employee agreements enforceable in Massachusetts?

Are non-solicitation of employee agreements enforceable in Massachusetts?

Yes, non-solicitation of employee agreements are enforceable in Massachusetts. Unlike non-compete agreements, they are not governed by the Massachusetts Noncompetition Agreement Act (MNAA). Instead, courts evaluate them under common law standards, requiring them to be reasonable in duration, scope, and necessary to protect a legitimate business interest.

The Legal Framework: Common Law vs. MNAA

It is a common misconception that the strict requirements of the MNAA (such as the requirement for garden leave or specific notice periods) apply to non-solicitation of employee agreements. Massachusetts courts treat non-solicitation of employees differently than non-competes because they do not restrict an individual's ability to earn a living in their chosen profession, but rather restrict the poaching of a company's workforce.

The Reasonableness Test

To be enforceable, a non-solicitation of employee clause must pass the "reasonableness" test. Courts look at the following factors:

• Legitimate Business Interest: The employer must prove the clause protects a specific interest, such as preventing the raiding of key personnel who possess trade secrets or proprietary knowledge.
• Scope of Restriction: The agreement should be limited to employees the former employee actually worked with or had influence over, rather than a blanket ban on all company staff.
• Duration: The time limit must be reasonable. While there is no statutory cap, courts typically view periods exceeding 12 to 24 months with skepticism.
• Geographic Scope: While less critical for employee non-solicitation than for non-competes, the restriction should still be tied to the area where the employee performed their duties.

Key takeaway: Do not assume your non-solicitation clause is bulletproof just because it is signed. If it is drafted too broadly—such as prohibiting the solicitation of any employee in the entire company—a judge may strike it down entirely or "blue-pencil" (rewrite) it to be more limited.

Action Item: Audit your existing employment contracts to ensure non-solicitation clauses are narrowly tailored to the specific roles and departments the employee interacted with.

Distinguishing Non-Solicitation of Employees vs. Customers

Employers often bundle non-solicitation of employees with non-solicitation of customers. It is vital to distinguish these, as courts apply different levels of scrutiny to each.

Action Item: Ensure your contract separates these clauses. If one is found to be overbroad, you want the other to remain severable and enforceable.

Red Flags for Unenforceability

Even if a contract is signed, Massachusetts courts may refuse to enforce it if it contains specific "red flags." Avoid these common pitfalls:

• Overbreadth: Prohibiting the solicitation of employees the signer never met or worked with.
• Lack of Consideration: In Massachusetts, if the agreement is signed after the start of employment, it must be supported by "new" consideration (e.g., a bonus, promotion, or stock options).
• Public Policy Violations: Clauses that prevent employees from seeking better opportunities in a way that serves no legitimate business interest.
• Vague Language: Terms that are not clearly defined, leaving the employee guessing as to which actions are prohibited.

Key takeaway: If your agreement lacks clear definitions of "solicitation"—such as whether it includes responding to an employee who reaches out first—you are at risk of the clause being deemed ambiguous and unenforceable.

Action Item: Review your "solicitation" definition. Does it explicitly exclude passive recruitment, such as general job postings on LinkedIn or public job boards?

Best Practices for Drafting Enforceable Clauses

To maximize the likelihood of enforcement in Massachusetts, follow these drafting guidelines:

1. Define the Restricted Group: Limit the restriction to employees with whom the departing employee had direct professional contact.
2. Specify the Prohibited Conduct: Clearly define "solicitation" to include active poaching but exclude passive hiring.
3. Include a Severability Clause: This ensures that if one part of the agreement is found unenforceable, the rest of the contract remains intact.
4. Keep it Time-Bound: Cap the restriction at a reasonable timeframe, typically 12 months.

Action Item: Update your standard employment agreement template to include a severability clause and a clear definition of "solicitation" that aligns with current Massachusetts case law.

Leveraging Technology for Contract Compliance

Manually reviewing every employment contract for enforceability is time-consuming and prone to human error. TermScore provides an AI-powered platform that automatically analyzes your contracts against current Massachusetts legal standards, identifying overbroad clauses, missing consideration, and other risks that could render your non-solicitation agreements unenforceable. By using TermScore, you can ensure your workforce agreements are robust, compliant, and ready for any potential litigation.