- Emergency Consultation Services
- Risk Management Services
- Who We Are
- Our People
- What We Do
- Why We Are Different
- What’s New
- Where We Are
While the future enforceability of non-compete provisions (and some other post-employment restrictive covenants) may be uncertain due to the recent efforts of the Federal Trade Commission, National Labor Relations Board and state legislatures, many employers still rely upon an employee non-solicitation provision to prohibit departed employees from soliciting current employees. For those employers in Georgia, a recent ruling by the Georgia Court of Appeals warrants a prompt review of your current employee non-solicitation covenants to ensure they comply with this new decision.
Specifically, on June 13, 2023, the Georgia Court of Appeals ruled that an employee non-solicitation provision must have a geographical limitation to be enforceable under Georgia’s Restrictive Covenant Act. N. Am. Senior Benefits, LLC v. Wimmer, 2023 WL 3963931 (2023). Further, the Court ruled that such a covenant that lacks a geographic territory cannot be salvaged by a court pursuant to the “blue-pencil” rule, which is a statutory rule that allows Georgia courts to judicially modify unenforceable restrictive covenants so they become enforceable in their new form.
As a result of this decision, Georgia employers that use employee non-solicitation provisions with their workforce must ensure that their employee non-solicitation provisions contain a geographic limitation identifying where the solicitation cannot occur. We also highly recommend limiting the solicitation prohibition to employees with whom the departed employee had interaction with during the departed employee’s tenure with the employer.
If your existing employee non-solicitation provision does not contain a geographic limitation (and is not limited to those he/she interacted with), then it is important to prepare an updated provision and implement it amongst those employees who are subject to this type of provision. For any questions or comments related to this article or post-employment restrictive covenants in Georgia, please reach out to Brad Adler ([email protected]; 770.818.1413) or Zach Jarvis ([email protected]; 678.996.9039) in Freeman Mathis & Gary’s National Labor & Employment Group.