What does a non-solicitation agreement cost? Many business owners who want to protect their company may ask this question. So let’s explore non-solicitation agreement costs and review some general information about non-solicitation agreements and how they work.
How Much Does a Non-Solicitation Agreement Cost?
A non-solicitation agreement is a legally binding contract clause that prevents an employee from taking clients, other employees, or confidential information from their current employer to a new employer or to start a new company.
Every business owner knows that without customers and employees, they wouldn’t have a business. When employees leave the company in pursuit of a new job or to work for another company in the industry, a non-solicitation agreement prevents them from stealing customers and benefiting from their former company at their new place of work.
Non-solicitation agreements are usually part of more comprehensive agreements like an employment contract that covers a non-compete agreement and a nondisclosure agreement. However, a non-solicitation agreement can also be a stand-alone contract.
No matter how your non-solicitation agreement is structured, it is highly recommended that an experienced attorney drafts the agreement. An attorney will know the laws that govern non-solicitation agreements in your state and how to draft a comprehensive non-solicitation agreement that stands up in court and protects the company.
According to ContractsCounsel’s marketplace data, the average cost of a project involving a non-solicitation agreement is $589.38.
What’s Typically Included in a Non-Solicitation Agreement
Non-solicitation agreements will vary based on the company's industry, business, and needs. Therefore, these agreements should include as much detail as possible to ensure they are not overly broad and unenforceable.
It is important to include the following key information in a non-solicitation agreement:
- Term. The agreement should state when the contract goes into effect and how long it will apply. The contract typically goes into effect when the newly hired employee signs it. Term length must be reasonable to be enforceable. The longer the term, the less likely a judge will be to enforce it.
- Geographic Location. Non-solicitation agreements are usually restricted to a specific area defined in the agreement. Just like term, the area cannot be unreasonably large.
- Types of Restricted Solicitation. The agreement should have clear terms and conditions of the kind of solicitation that is prohibited. This section should be very detailed and specific.
- Covered Employees. A non-solicitation agreement will not cover all employees. For example, it is common to include managers and higher-level employees. However, entry-level employees won’t typically be included.
- Consideration. Consideration is a necessary element of a contract to make the contract legally binding. Consideration means that both parties are receiving something for adhering to the contract. In this case, the employee gets the job in exchange for signing the agreement.
- Statement of Non-Solicitation. The agreement should expressly state that the employee agrees to refrain from soliciting customers and employees from the current employer.
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Are Non-Solicitation Agreements Enforceable?
Non-solicitation agreements can be enforceable if they are drafted correctly. However, there is an unofficial right to work, so if the non-solicitation agreement prevents a person from working, it cannot be legally enforced.
Judges often view non-solicitation agreements in a light most favorable to the employee, so employers need to be sure that their agreement is fair, reasonable, and detailed. A good non-solicitation agreement will meet the following conditions:
- The agreement doesn’t prevent employees or customers from leaving the company
- The protected customer list is valuable and specific
- There is a particular business purpose for the non-solicitation agreement
- The company invested time, money, and energy into building a client or customer list
- The employee must be able to find work
- The non-solicitation agreement cannot stop employees from voluntarily leaving
Examples of Non-Solicitation Agreement Projects
Non-Solicitation Agreement Drafting Service
Non-solicitation agreements are important contract clauses because they protect a company from losing its customers, employees, and confidential information. If this contract isn’t drafted correctly, it will not be upheld in court.
Suppose you hire a lawyer to draft your non-solicitation agreement. In that case, you will meet with the lawyer to discuss your business and the purpose of the non-solicitation agreement. The lawyer will then draft a custom-tailored non-solicitation agreement for you to use with your employees.
Non-Solicitation Agreement Review Service
Non-solicitation agreement templates are easy to find, so many business owners may choose to draft their contracts. While this can be done, it is always recommended to have an attorney review the contract before using it with employees.
An experienced lawyer will ensure the non-solicitation agreement follows all applicable laws and includes all information to protect you and your company.
Non-Solicitation Agreement Drafting Costs
Hiring a lawyer to draft a non-solicitation agreement will incur legal fees. In addition, the lawyer will charge for any time spent working on the agreement, which can include consultations and revisions.
ContractsCounsel’s marketplace data shows that the average non-solicitation agreement drafting costs are $650.00 across all states and industries.
Non-Solicitation Agreement Review Costs
A lawyer will charge for review services, although these will typically be less than drafting services. The lawyer will use their time and legal expertise to ensure the non-solicitation agreement is legally binding and will hold up in court.
According to ContractsCounsel’s marketplace data, the average non-solicitation agreement review costs are $580.71 across all states and industries.
How Do Lawyers Charge for Non-Solicitation Agreements?
Hourly Rates for Non-Solicitation Agreements
Lawyers who provide document drafting services can charge clients using an hourly rate fee structure. When a lawyer uses an hourly rate, they first inform the client of their hourly rate. Then, if the client agrees, the lawyer will bill the client for the number of hours spent working on their project.
Hourly rate fee structures ensure that a lawyer is pretty compensated but could lead to a client being surprised by an unexpectedly high bill. Therefore, clients and lawyers should often communicate to ensure the client is informed of their legal bill.
The marketplace data for ContractsCounsel shows that the average hourly rate for a non-solicitation agreement lawyer ranges from $200 - $350 per hour.
Flat Fee Rates for Non-Solicitation Agreements
Flat fee rates are commonly used by lawyers when they are hired for a one-time project like drafting a non-solicitation agreement. Instead of billing hourly, the lawyer will estimate the number of hours the project will take to complete and charge the client accordingly. Under a flat rate fee structure, the attorney usually requires that the fee is paid upfront.
Clients prefer the flat fee billing structure because they know exactly what they will pay for an attorney’s legal services. However, the client should be sure of what this fee covers because a lawyer may charge additional fees for more meetings or revisions.
ContractsCounsel's marketplace data shows that the average flat fee rate for a non-solicitation agreement is $589.38.
Get Help with a Non-Solicitation Agreement Project
Do you need help with a non-solicitation agreement? If so, post a project in ContractsCounsel’s marketplace to receive flat fee bids from contract lawyers to handle your project. All lawyers on the ContractsCounsel’s platform are vetted by our team to make sure you are provided with top tier service.
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