Why is a restrictive covenant useful?

Author: Melanie J. Perez-Vellios, VP Group, LLC

The value of a restrictive covenant cannot be understated. A restrictive covenant allows an employer to go beyond applicable law and craft stronger agreements that are tailored to the employer's specific needs and risks. For example, where a state law may protect against unauthorized computer usage by an employee, a restrictive covenant can also prohibit use of other confidential information, including: client records, pricing information, trade secrets and customer lists. Where the restrictive covenant is narrowly tailored to the specific business needs of the employer and is limited to a reasonable scope and duration, a restrictive covenant can provide invaluable protection for an employer.