What a Non-Solicitation Provision Actually Does

A non-solicitation provision is a contract term that prevents parties from doing business with contacts they were introduced to through your company. It is not about asking for business—solicitation in most contracts is defined broadly enough to cover any direct dealing, regardless of who initiated it.

The core purpose: you make introductions, build relationships, and invest in setting up a deal. A non-solicitation clause keeps the other side from cutting you out once they see the value in those connections.

How This Plays Out in Practice

Say you run an ad agency. A client pays you a percentage of their ad spend. Over time, the client learns the ropes and decides to go straight to the advertisers you introduced them to—saving your fee. A non-solicitation provision in your contract prevents exactly that. You might also have a matching clause with the advertisers, blocking them from dealing directly with clients you brought to the table.

The same logic applies to employees. An employer invests in building customer and supplier relationships, then trusts an employee to manage those accounts. Without a non-solicitation agreement, nothing stops that employee from quitting, opening a competing shop, and taking those relationships with them.

Minnesota banned most non-solicitation provisions in 2024, with a narrow exception for tech services. California has long prohibited these clauses for employees. In states with bans, it is not just that courts refuse to enforce the clause—including one can itself be illegal.

The policy debate cuts both ways. Supporters say parties agree voluntarily and receive real value in exchange. Critics say these clauses restrain free trade. Whichever side you favor, what matters is whether the state you operate in has a ban.

What to Do Now

Review your contracts with clients, vendors, and employees. Identify relationships where someone could cut you out of a deal, and determine whether a non-solicitation clause is enforceable where you operate. Do not confuse this with a non-compete—a non-solicitation clause specifically prevents others from going around you to deal directly with contacts you brought to the relationship.

Video Transcript

Considering Non-Solicitation Agreements

As we think about independent contractor relationships and we are thinking about the types of service contracts you have, so the people whose services you use, one issue that may come up is non-solicitation agreements, or non-solicitation provisions as part of a larger agreement.

What Is Solicitation?

What is non-solicitation? Well, let’s talk about what is solicitation. Solicitation is when you ask for business.

How Non-Solicitation Provisions Work

So a non-solicitation provision essentially means somebody cannot ask for business. Now solicitation is usually defined in the contract, and usually it is not just asking for business; It is doing business together, agreeing to do business together. It doesn’t really matter if it is an ask, it just is, Do they do business together?

Purpose Behind the Agreement

So basically it is a contract that says, “Two parties or more will not do business together.”

The Setup

Well, one might this matter. Let’s say that you are an ad agency and your client company comes to you and says, “We would like your help in creating ads.” And your agreement is that for all of those ads that run, you will get paid ten percent whatever the client spends on ads.

The Client Goes Around You

Now, let’s say over time, the client says, “You know what? We have kind of gotten the hang of this. And so rather than going to you, and then going to the various advertisers through you, we want to just cut you out. We are going to go straight to the advertisers and save the ten percent fee that we are having to pay you.”

Preventing Circumvention

Well, that may not feel fair to you. You made these introductions. You got everything set up, and as soon as the client was equipped by you to operate, the client decides to cut you out of the deal and go straight to the advertisers.

Drafting the Non-Solicitation Terms

Well, in this case, you might put in your agreement with the client a non-solicitation provision, which says, The client can’t do business directly with the advertisers.
You might also have an agreement with the advertisers that says, If any of my clients come and do business with you through me, you can’t do business with them.

Duration of Restrictions

Now, usually there is a period of time when this expires, but that could be a year, it could be three years, it could be 10 years. It really depends on the circumstances.

Purpose of Protection

So a non-solicitation is usually where one party is making introductions and you are wanting to make sure that they don’t cut you out of the deal.

Minnesota Law Update

Now, there is a type of non-solicitation provision that is illegal in some states.
In 2024, the state of Minnesota said, “Most non-solicitation provisions are illegal.” Which means they are not enforceable.

Exception for Tech Services

Now, there is a carve-out or an exception for tech services. But for all other companies, there is a ban on non-solicitation provisions. They won’t be enforced.

Real-World Impact

This is a really big deal because imagine you have an advertising company like we just talked about and you don’t want to get caught out of the deal. Well now, under Minnesota law, that provision is not enforceable.

Employee Non-Solicitation Bans

This is also relevant with employees. There are a number of states throughout the country. California and Minnesota are two of them, where it is illegal for an employer to ask an employee to sign a non-solicitation agreement. It is not enforceable. It is prohibited by law.

Why Employers Consider It

You might think, “Well, why would an employer want to do that?”
Let’s say, for example, the employer is a company that sells stuff. So they buy products from a manufacturer, and then they sell the customers. That is a very important relationship.

Risks of Losing Client Relationships

Now, if they hire an employee, who then starts managing that account. Managing who they are selling to and who they are buying from. That employee might say to themselves, “Hey, I don’t need this company anymore. Now that I have loyalty of the relationship, I can quit the company, open my own business, and I keep all the money. I don’t have to share any with the original company who worked to set up this relationship.”

Ethical Dilemma

Now you might say to yourself, “That doesn’t seem right.” If the original company spent years investing in setting up these relationships and trying other relationships that failed and they put a lot of money and investment into that and then they trusted you to work in the role of managing those relationships, you might say, “It doesn’t feel right. It feels unethical to just cut out the employer and go operate on your own.”

Arguments For and Against

That is the argument for non-solicitation provisions.
The argument against them is that it is an unfair restraint on a person’s right to do business with who they want to do business with.
So, the idea when legislators ban non-solicitation provisions, their concern is, “We don’t want to stop people from doing business with each other. It is a free country. We should have a right to do business with whoever we want. So we are going to ban non-solicitation provisions.”

Counterarguments

The counterargument to that is, well, nobody is being forced to sign these agreements. They are usually being paid good money or being offered significant opportunities with a position of trust in order to proceed with this non-solicitation provision.

Understand State Laws

So whatever your position on whether non-solicitation provisions should be banned, that doesn’t really matter. What does matter is, Does the state you are operating in have a ban on non-solicitation agreements or non-solicitation provisions? So that is an important item to attend to.

When to Use a Non-Solicitation

The other takeaway here is to think about whether there are certain contracts of yours where you should have a non-solicitation provision. Where it is important that the people that you are bringing to the deal don’t somehow cut you out of the deal in order to save from having to pay you money.

Non-Solicitation vs. Non-Compete

It is easy to confuse non-solicitation provisions with non-compete provisions. The key to remember is a non-solicitation provision prevents others from cutting you out of a deal by doing business with each other directly. This could be employees, contractors, or others that are involved in a deal.

Free Resource for Business Owners

Now, if you would like to know more about how to avoid trouble like this, I have a free resource at AaronHall.com/free. I provide information for business owners of small to mid sized companies on how to avoid common legal problems. That includes a PDF. It includes videos talking about important issues.