by Vincent A. Toreno, Esq.

In our ongoing effort to provide relevant information to our clients, we will occasionally spotlight a topic which falls outside of typical workers’ compensation issues but touches on general employment related matters. For instance, when an employee leaves a company, employers are understandably interested in protecting their trade secrets and other information vital to success in the marketplace. Employers may seek to curtail a former employee’s ability to use information learned at the employer with one of the competitors. To that end, employers often require new employees to agree to non-compete and non-solicitation provisions to protect the company for a period of time after separation. Restrictive covenants must be carefully drafted to ensure they are enforceable. However, even valid restrictive covenants may be deemed invalid if the employee successfully challenges another part of the agreement. For example, a former employee may claim the employer breached the employment agreement by failing to pay disputed wages or bonuses and that this breach renders the entire employment agreement, including the provisions meant to protect the employer’s valuable information, invalid and unenforceable.

An employer can protect against this tactic by including a “severability clause” in the employment agreement. Doing so will greatly assist the employer in defending a “prior breach” claim and assist in convincing the court that an injunction against the former employee at the beginning of the case is necessary to prevent irreparable harm to the employer. The key is to ensure that the employment agreement establishes clear intent of the parties to make a restrictive covenant “independent” of other portions of the agreement. By separating and rendering independent a restrictive covenant or “non-compete” clause, the court is then allowed to enforce it without being mired in a determination about whether a disputed bonus or salary was or was not paid. In Georgia, a sample severability clause that has been accepted by the courts reads as follows:

These covenants on the part of the employee shall be construed as an agreement independent of any other provision in this agreement, and the existence of any claim or cause of action of the employee against the company whether predicated on this agreement or otherwise, shall not constitute a defense to the enforceability by the company of said covenants.

Some careful wording at the outset of the employment relationship can go a long way to protecting the employer once that relationship ends. By ensuring the written employment agreement contains a severability clause, the employer will be in a much better position to get a court to enforce restrictive covenants without first having to establish the validity of other provisions in the agreement.