How Long Can a Non-Compete Last Under New York Law?
One of the most common – and important – questions that we get asked in the context of assessing the enforceability of a non-compete agreement is this :
How long can a non-compete last before it's automatically deemed unenforceable?
And the reason that this question is critical is actually kind of obvious and logical: during that time period, the employee is supposed to sit on the sidelines, and refrain from working, and bringing home a paycheck in his chosen field.
There is no question that this is a most serious issue.
So, how have New York’s courts handled the question?
Unfortunately, insofar as New York is concerned, there really isn’t a bright-line test;
There isn't anything that says something like, “Under New York law, a non-compete clause will not be enforced if it exceeds “X” amount of time.”
Rather, New York’s courts have evaluated this issue on a case-by-case basis to see whether the non-compete is reasonable, and calculated to protect the former employer’s legitimate business interests. Thus, for example, while a 2-year or 3-year non-compete for some specialists, such as in the medical field, may be upheld, a similar time restriction on a regular sales person might be invalidated.
Consequently, it should come as no surprise that New York’s courts have held invalid – and unreasonable - some non-competes that were as short as 6 months to 1 year, and in other cases upheld non-competes that lasted as long as 5 years!