Employers, and some attorney’s, are operating under the false pretense non competes are not enforceable in New York – reminding you, they are.
In 2024, The Federal Trade Commission tried to pass a rule banning non-competes but was struck down as agency overreach (FTC is not authorized to create law, only to interpret and assist with compliance). The New York Senate Bill S9759, attempting to ban non-competes with set carve outs for employees making over $500,000 annually, was recently passed by the State Senate, but is still not law. We are also not swayed the bill will be signed into law, as the first iteration of the bill was vetoed by Governor Hochul in February 2025, and the current iteration being reviewed is nearly identical to the one vetoed by the Governor.
Now that we are clear there is no regulatory action or legislation in New York which automatically holds non competes unenforceable ab initio, the next question is how are courts interpreting such provisions? New York Courts continue to hold non competes as enforceable where the non compete is reasonable in scope, time, geographic area, and is deemed necessary to protect the employer’s interests. See BDO Seidman v. Hirschberg, 93 N.Y.2d 382, 389 (Ct. Appeals. 1999). Some attorneys have led with the erroneous notion that where an employee is terminated without cause the restrictive covenant is automatically unenforceable, once again this is incorrect. A court’s review of a non compete will always be fact specific. Meaning the court is focused on the purpose and reach of the restrictive covenant in light of the employees’ position at the practice or business, and the interests the employer seeks to protect.
“Reasonable” is not a “one size shoe fits all”, it is heavily contingent on the actual language at issue and its application to the parties involved. For example, in Long Island Minimally Invasive Surgery, P.C. the Court found a non compete barring a doctor from practicing surgery of any kind within a 10-mile radius of the hospital or an affiliated hospital was unreasonable because it effectively barred the doctor from performing surgery in the New York metropolitan area. 164 A.D.3d 575 (2d. Dept. 2018). However, in Battenkill Veterinary Equine, the court found a non compete barring the practice of equine medicine for three years within a 35-mile radius of the employers practice reasonable, because the restriction did not apply to all veterinary medicine. 1 A.D.3d 856, 858 (3d. Dept. 2003).Once again, each enforcement of a non compete is based on the facts relevant to the parties at issue, there is no blanket rule.
Bottom line: a non compete is an important contractual restriction to protect the value of an employer’s practice. In fact, even if potentially unreasonable in scope and duration, the threat of litigation is usually its own effective deterrent. As with all other contractual provisions, lawyers are still necessary! Claude and Chat are not equivalent substitutes.
