How To Navigate And Challenge A Non-Solicitation Clause In NZ

If you’re running a small business, your customer relationships and your team can be two of your biggest assets. So when a key employee leaves (or a contractor moves on), it’s normal to worry about them taking clients or staff with them.

That’s where a non-solicitation clause (often discussed as a non-solicitation clause in New Zealand) can help. But these clauses can also be challenged if they’re too broad, unclear, or not genuinely protecting a legitimate business interest.

In this guide, we’ll walk through what a non-solicitation clause is, when it’s generally enforceable in New Zealand, and how you can navigate (and, where needed, challenge) a clause in a practical, employer-friendly way.

Note: This article is general information only and doesn’t take into account your specific situation. If you need advice on a particular clause or dispute, it’s best to get legal advice.

What Is A Non-Solicitation Clause In New Zealand (And What Does It Actually Stop)?

A non-solicitation clause is a contract term that restricts a departing worker from approaching or poaching certain people connected to your business for a defined period after they leave.

In practice, New Zealand employers usually use a non-solicitation clause to cover one or both of the following:

• Client/customer non-solicitation: stopping the person from contacting your customers or clients to win their business.
• Employee non-solicitation: stopping the person from approaching your staff to recruit them to a new business or employer.

This is different from a non-compete clause, which tries to stop someone from working in a competing business at all (usually harder to enforce). If you’re using restraints, it’s worth ensuring your overall package fits together properly alongside your Employment Contract.

Common Misunderstandings To Watch Out For

• “No contact at all” vs “no solicitation”: A non-solicitation clause typically targets active approaches. It doesn’t always stop a former customer from choosing to follow the person on their own (and disputes often turn on whether there was any encouragement or targeted conduct).
• “Any customer ever”: Clauses that cover every customer the business has ever had (with no time limit or relationship requirement) are more likely to be challenged.
• Contractors are different: A contractor relationship is often assessed more like a commercial arrangement than a standard employment relationship, which can affect how “reasonableness” is argued and what the contract should say. If you engage contractors, your Contractors Agreement should deal with solicitation and confidentiality in a way that matches the reality of the engagement.

When Should Employers Use A Non-Solicitation Clause?

For small businesses, a non-solicitation clause is often a “middle ground” restraint: it’s usually more targeted than a non-compete clause and easier to justify if it’s protecting genuine relationships you’ve invested in.

You’ll commonly consider a non-solicitation clause if:

• You have employees who manage key accounts or ongoing client relationships (for example, professional services, agencies, trades, health and wellbeing practices, IT providers).
• Your business relies on repeat custom and trust (where the relationship is a big part of why the customer stays).
• Team stability matters (for example, you’re a small team and losing two people at once would be a major operational hit).
• You’re giving someone access to commercially sensitive information (pricing, proposals, pipelines, client lists, or internal processes).

Think Of It Like Insurance For Relationships

As an employer, you’re not trying to “punish” someone for leaving. You’re trying to protect the relationships and goodwill your business paid to build.

This is also why non-solicitation clauses tend to work best when they’re paired with strong confidentiality and information-handling expectations (including return of property and deletion of data where appropriate). If you have staff handling customer data, it may also be worth tightening your internal privacy and information practices, including an Employee Privacy Handbook.

Are Non-Solicitation Clauses Enforceable In New Zealand?

Non-solicitation clauses can be enforceable in New Zealand, but they’re not “automatic”. In most cases, they’re treated as a form of restraint of trade, which means enforceability usually comes down to whether the restraint is reasonable in the circumstances.

While the details can get technical, the underlying idea is straightforward: the clause must protect a legitimate business interest and go no further than reasonably necessary.

What Counts As A “Legitimate Business Interest”?

Examples that often support a non-solicitation clause include:

• Customer connections and goodwill built through your business (not purely personal friendships).
• Confidential information that would give someone an unfair advantage if used elsewhere.
• Workforce stability, particularly if someone could otherwise recruit multiple staff and destabilise your operations.

On the other hand, a clause is more vulnerable to challenge if it’s effectively trying to stop competition for its own sake.

What “Reasonable” Usually Means In Practice

Reasonableness is assessed case-by-case, but employers should expect scrutiny around:

• Duration (how long the restriction lasts). In many industries, 3–6 months might be easier to justify than 12+ months, but it depends on sales cycles and relationship length.
• Scope (who is covered). For example: only clients the worker dealt with in the last 6–12 months, rather than every client on your CRM.
• Activity restricted (what “solicitation” means). Clear definitions matter.
• The person’s role (seniority and influence). A blanket clause applied to every junior role is easier to challenge than one tailored for a client-facing manager.

Because restraint issues can escalate quickly into disputes (and urgent applications), it’s worth getting the right structure upfront. If you’re thinking about adding or enforcing restraints, a restraint of trade advice review is often a smart early step.

How Do You Draft A Strong Non-Solicitation Clause (That’s Less Likely To Be Challenged)?

Many non-solicitation disputes don’t happen because the concept is wrong. They happen because the clause is vague, overreaches, or doesn’t match the reality of what the person actually did in your business.

Here’s a practical drafting checklist to help you reduce the risk of a challenge and improve your ability to enforce the clause later.

1) Define “Solicit” Clearly

If you don’t define solicitation, you leave room for argument.

Consider spelling out whether solicitation includes:

• direct approaches (calls, emails, meetings, DMs)
• indirect approaches (using someone else as an intermediary)
• targeted advertising directed at particular clients
• responding to an approach from a former client (this can be a grey area, and whether it breaches the clause often depends on the exact wording and the surrounding conduct)

The goal is clarity without trying to ban ordinary, fair competition.

2) Narrow The Restricted Group

Instead of “any customer of the business”, stronger clauses often focus on customers or clients who are genuinely at risk, such as:

• clients the person serviced or managed
• prospects the person actively worked on (for example, in a pipeline)
• clients they had material dealings with in a defined period (for example, the last 6 or 12 months)

This helps show the clause is aimed at protecting goodwill, not blocking someone’s livelihood.

3) Use A Reasonable Time Period (And Match It To Your Sales Cycle)

There’s no single “correct” duration, but you should be able to explain why you chose it.

For example:

• If your work is project-based and clients come and go quickly, a long restraint may look excessive.
• If your work is relationship-based with long renewal cycles, a longer period may be easier to justify.

4) Make Sure The Clause Fits With Confidentiality Obligations

A non-solicitation clause isn’t a substitute for confidentiality protections. You’ll usually want both.

For instance, even if a former employee doesn’t “solicit” a customer, misuse of confidential pricing, customer lists, or proposals may still be an issue. That’s where your confidentiality drafting (and sometimes a separate Non-Disclosure Agreement) can matter.

5) Keep Your Documentation Consistent Across Policies

Employers sometimes forget that contractual restraints can be undermined by inconsistent internal rules.

For example, if you’re concerned about poaching or conflicts, a clear Conflict Of Interest Policy can help set expectations while the person is still employed (which can also reduce the likelihood of issues on exit).

How Can Employers Navigate And Challenge A Non-Solicitation Clause Dispute?

“Challenge” can come up in a few different ways for employers:

• You want to enforce your clause, and the former employee says it’s unenforceable.
• You’re negotiating with a new hire who pushes back on a non-solicitation clause in your agreement.
• You’ve inherited restraints (for example, through buying a business), and you need to work out if they’re workable or need updating.

Either way, the best approach is usually calm, evidence-based, and step-by-step.

Step 1: Identify What You’re Actually Trying To Protect

Before you fire off a warning letter, get clear on the business interest at stake. Ask:

• Which customers are at risk, specifically?
• Which staff members are at risk of being approached?
• What confidential information did the person have access to?
• What damage is realistically likely (lost revenue, disrupted projects, loss of team capacity)?

This matters because if you end up needing to justify the restraint, you’ll want a clear explanation that ties the clause to real risks.

Step 2: Check The Paperwork (And The Timeline)

It sounds obvious, but disputes often turn on details like:

• which contract version was actually signed
• whether the clause was properly incorporated (especially if you used “updated terms” later)
• what the clause actually says about time periods and the restricted group
• the person’s role and duties (what they truly did day-to-day)

If the clause is overly broad, poorly drafted, or inconsistent with the role, you may need to consider whether it’s better to negotiate a practical outcome rather than pushing for strict enforcement.

Step 3: Gather Evidence Early (Without Crossing Privacy Lines)

If you suspect solicitation, you’ll usually want to act quickly. Evidence may include:

• customer communications showing they were approached
• LinkedIn messages or emails (where customers are willing to provide them)
• patterns of customer departures shortly after the person left
• internal records showing client ownership and relationships

Be careful about how you collect and use information, especially where personal information is involved. Employers still need to act consistently with privacy obligations under the Privacy Act 2020 (and fair process expectations in an employment context).

Step 4: Start With A Commercial Conversation

Many New Zealand non-solicitation disputes can be resolved without formal action if you approach it commercially.

Depending on the situation, you might:

• send a clear but reasonable reminder of obligations
• request written undertakings (for example, confirmation they won’t contact certain clients for the restraint period)
• agree on a list of “quarantined” clients
• clarify what you consider “solicitation” (so there’s less room for “we didn’t know” arguments)

Often, the aim is to stop ongoing harm, not to “win” an argument.

Step 5: Consider Formal Options If The Risk Is Serious

If the issue is significant (for example, a major client book is being targeted, or multiple staff are being poached), you may need stronger steps. Depending on the circumstances, options can include:

• Mediation (often encouraged in employment matters and commonly used to try to resolve disputes, but it isn’t always mandatory in every situation)
• Seeking urgent court orders in appropriate cases (for example, injunctive relief to stop solicitation while the dispute is determined)
• Employment Relations Authority processes where the dispute is employment-related

What’s “best” depends on speed, cost, evidence strength, and what outcome you actually need.

Step 6: If You’re The One Challenging A Clause, Focus On Overreach And Uncertainty

Sometimes employers need to challenge a restraint too (for example, where you’re acquiring a business and the restraint terms could create hiring risk, or where a non-solicitation clause in a template is so broad it’s likely to fail if tested).

In those situations, common pressure points include:

• Overly broad scope (too many customers, too many staff categories, unclear “associated entities”)
• Unrealistic duration that doesn’t match the role
• Unclear drafting (undefined terms, conflicting clauses, or obligations that can’t realistically be complied with)
• Mismatch with the worker’s position (for example, restraints applied to a junior employee who didn’t hold key relationships)

Challenging early can be a “risk management” move: it’s usually cheaper to refine the clause now than to find out later that you can’t rely on it.

Key Takeaways

• A non-solicitation clause in New Zealand is designed to prevent departing employees or contractors from actively approaching your customers or staff for a defined period.
• Non-solicitation clauses can be enforceable, but they’re typically treated as a restraint of trade and need to be reasonable and protect a legitimate business interest.
• To reduce the risk of a challenge, draft clearly: define “solicitation”, narrow the restricted group, and choose a duration that matches your industry and sales cycle.
• If there’s a dispute, start by identifying the real business risk, checking the signed documents, and gathering evidence carefully (including keeping privacy obligations in mind).
• Many matters can be resolved commercially through written undertakings or agreed “do not contact” lists, but urgent legal steps may be needed if the harm is serious.
• If your clause is too broad or unclear, refining it early can protect your business better than relying on a template that may not hold up under pressure.

Note: This article is general information only and isn’t legal advice. For advice tailored to your situation, consider speaking with a lawyer.

If you’d like help reviewing, drafting, or enforcing a non-solicitation clause (or any restraint of trade terms) for your business, you can reach us at 0800 002 184 or team@sprintlaw.co.nz for a free, no-obligations chat.