A Non-Compete & Non-Solicitation Agreement restricts post-employment competition and solicitation of clients or employees. This playbook focuses on enforceability standards, scope limitations, and remedies for breach.
Why This Matters: Restricting unapproved assignments prevents loss of control over service quality and liability exposure.
Negotiation strategy
If you're the Company:
Ensure that any assignment or subcontracting requires prior written consent to maintain control over service quality. Include provisions that hold the original party accountable for any breaches by assignees or subcontractors.
If you're the Contractor:
Negotiate for reasonable consent terms to avoid unnecessary delays. Ensure that any subcontracting does not relieve you of your obligations under the agreement.
Essential elements
1
Consent Requirement
Prior written consent needed.
2
Accountability
Original party remains liable.
3
Subcontractor Compliance
Subcontractors must follow agreement terms.
Action framework
ACCEPT
Propose edits if the clause lacks clear accountability or consent requirements.
EDIT
Reject if the clause allows assignment without consent.
ADD
Add language to ensure subcontractor compliance and accountability.
PRO TIP
Always verify that the clause aligns with company policy and industry regulations to avoid compliance issues.
Example clauses
FAVORABLE
Preferred Assignment Clause
"Neither party may assign or transfer any of its rights or obligations under this Agreement without the prior written consent of the other party, which consent shall not be unreasonably withheld or delayed. Any attempted assignment or transfer without such consent shall be void and of no effect."
NEUTRAL
Standard Consent Clause
"Assignment or subcontracting is permitted only with prior written consent, and the original party remains responsible for all obligations."
UNFAVORABLE
Unrestricted Assignment Clause
"Either party may assign its rights or obligations without consent."
Fallbacks
High-Risk Projects
In high-risk projects, ensure that any assignment or subcontracting is subject to stringent review and approval processes to mitigate potential risks.
Government Contracts
Government contracts often have specific regulations regarding assignment and subcontracting. Ensure compliance with these regulations to avoid penalties.
Healthcare Agreements
In healthcare agreements, ensure that subcontractors meet all regulatory requirements to maintain service quality and compliance.
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