Mr. Wilner worked for an accounting firm that had branches around the tri-state area. When accepting the job, he had signed a non-compete agreement that limited him from working for a competitor within a 50-mile radius of his “company workplace” for two years after leaving the company.
Mr. Wilner was assigned to an office in Manhattan, but was allowed to work at home twice a week. During the Covid period, much of his work shifted to remote, and he now worked mostly from home.
After eight years with the firm, Mr. Wilner decided to leave. He was offered a new position by a firm on Long Island that allowed him to continue working remotely from home. The new firm was more than 50 miles from his Manhattan office, but only 25 miles from his house.
“I’m concerned about the non-compete,” Mr. Wilner said to his wife.
“What’s the problem?” asked Mrs. Wilner. “The new firm is more than 50 miles from your Manhattan office.”
“The question is: From where to measure?” replied Mr. Wilner. “As you know, I have been working mostly from home recently; even initially I was allowed to work twice a week from home. Is the house considered a workplace? I plan to continue working at home!
“Moreover, the previous firm has a branch in Long Island,” added Mr. Wilner, “not far from the new firm. Do I measure from the Manhattan office, or also from the company’s other branches?”
“Perhaps consult with Rabbi Dayan,” suggested Mrs. Wilner.
Mr. Wilner called Rabbi Dayan, and asked:
“Is the new position in compliance with the non-compete agreement?”
“The degree to which non-competes are halachically binding depends on their nature, so that the entire agreement must be examined, but usually a person should strive to uphold it,” replied Rabbi Dayan. “Regardless, when there is ambiguity in a document, various factors need to be considered.
“One relevant factor is that expressed by the Rivash (#207), cited by Darchei Moshe (42:3) and Sma (42:28), that we follow the normal usage of language by people in that locale. This follows the Gemara in Nedarim (49a) that says, regarding interpretation of nedarim – vows, we follow the normal usage of language. Rivash extends this to interpretation of contracts and documents.
“The normal use of ‘company’ or ‘workplace’ indicates an office, not one’s home, even if the employee typically works remotely. Thus, the requirement to distance a certain radius should be measured from the company’s office, primarily where you were assigned, even if you worked from home.
“Furthermore, even if the company has numerous offices in the area, so that perhaps one could interpret the term to mean that the competitor must be 50 miles from any office, this brings us to a second principle, that of yad baal hashtar al hatachtona – that one who claims based on a document has the weaker hand to force the obligating party, unless expressly stated otherwise (C.M. 42:5).
“This is because without the non-compete there is no limitation on the former employee. The employer who wants to limit the employee’s right to work based on his commitment through the non-compete can limit him only from what the non-compete clearly includes.
“Thus, if there is doubt about what the agreement includes, such as whether to measure from the employee’s particular office or from any office, the employer has the weaker hand; we interpret it in the manner curtailing the former employee less.
“This provides a halachic perspective, but is not intended as legal advice,” concluded Rabbi Dayan. “It is wise to consult a lawyer, since judicial rulings regarding non-competes vary from state to state, depend on the precise language of the agreement, and are subject to the discretion of the particular judge.”
Verdict: Two halachic principles in interpreting contracts are that we follow normal language usage in that locale, and that yad baal hashtar al hatachtona – the one claiming based on the document has the weaker hand. Thus, the radius of the non-compete is measured from the company’s office to which the employee was assigned, not his home, even if he works remotely, nor from other offices.
