Non-Solicitation Clauses in South Carolina: Strict Review

South Carolina's Approach to Restrictive Covenants

South Carolina courts evaluate non-solicitation clauses under common law, applying what courts describe as strict scrutiny. The South Carolina Supreme Court in Poynter Investments v. Century Builders of Piedmont and Rental Uniform Service v. Dudley has established that while restrictive covenants are not per se invalid, they are strictly construed against the employer and must meet exacting standards.

The Three-Factor Test

South Carolina courts evaluate non-solicitation clauses based on whether they are:

1. Necessary to protect a legitimate business interest: Customer relationships, goodwill, trade secrets, or confidential information
2. Reasonably limited in scope: Both the duration and the breadth of customers covered must be reasonable
3. Supported by valuable consideration: Adequate consideration must exist to support the agreement

Key Details

• Duration: South Carolina courts typically uphold restrictions of one to two years. The courts have emphasized that duration must be proportional to the interest being protected
• Customer scope: The clause must be limited to customers with whom the employee had material contact during employment. South Carolina courts have struck down clauses covering all company customers
• Consideration: For new employees, the employment relationship is sufficient. For existing employees, courts look for additional consideration such as promotion, increased compensation, or access to new confidential information

No Blue Pencil in South Carolina

South Carolina follows a traditional approach: courts do not reform or blue-pencil overbroad restrictive covenants. If a non-solicitation clause is unreasonable in any material respect, the court will void the entire provision. This makes South Carolina one of the riskier states for employers who draft overly broad restrictions.

Red Flags

• Any overbreadth (since courts will not reform the clause)
• Restrictions covering customers you never interacted with
• Duration exceeding two years
• No additional consideration for agreements signed after initial hiring
• Ambiguous terms that could be interpreted broadly

When to Consult a Lawyer

Consider contacting a South Carolina employment attorney if your non-solicitation clause seems to cover more customers than you actually served (which could void the entire clause), if you are leaving your employer and need clarity on your obligations, or if enforcement has been threatened.

This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney for guidance specific to your situation.