Non-Solicitation Clauses in Ontario Employment Contracts Explained
Non-solicitation clauses have become one of the most important tools Ontario employers have to protect clients, donors, and confidential business relationships, especially now that most non-compete clauses are banned under the Employment Standards Act, 2000 (ESA).
Used properly, a well-drafted non-solicitation clause can:
- Reduce the risk of key clients or donors leaving with a departing employee
- Protect the value of goodwill you’ve invested in building
- Provide a realistic, enforceable restraint that courts are more willing to uphold than non-competes
This article explains how non-solicitation clauses work in Ontario, what courts consider when deciding whether they are enforceable, and how employers, including non-profits, can draft them effectively.
What Is a Non-Solicitation Clause?
A non-solicitation clause in an employment agreement restricts a departing employee from actively trying to poach your business relationships, typically by:
- Soliciting or attempting to solicit your customers, clients, donors, or members
- Asking your employees or contractors to leave and join them or a competitor
Unlike a non-compete, a non-solicitation clause does not stop someone from working for a competitor or starting their own business. It only restricts targeted outreach to your relationships for a defined period.
Because Ontario’s ESA now generally bans non-compete clauses (outside narrow exceptions), courts increasingly expect employers to rely on non-solicitation and confidentiality clauses instead.
Are Non-Solicitation Clauses Enforceable in Ontario?
Yes, if they are reasonable.
Non-solicitation clauses are still treated as “restraints of trade”, so courts scrutinize them. But the Supreme Court of Canada and the Ontario Court of Appeal have consistently said they are more acceptable and easier to justify than non-competes, especially in employment relationships.
Key cases:
- Elsley v. J.G. Collins Insurance Agencies Ltd.: SCC confirmed that restrictive covenants are enforceable if they are reasonable in scope and needed to protect a legitimate business interest.
- Lyons v. Multari (2000 ONCA): Ontario Court of Appeal held that, in employment settings, a narrow non-solicitation clause is usually preferred to a non-compete, and will often be enough to protect an employer’s interests.
- H.L. Staebler Co. v. Allan (2008 ONCA): Court enforced a client-focused non-solicitation clause where a producer had strong personal relationships with clients; focus was on reasonableness and protecting goodwill, not punishing competition.
The bottom line:
Courts in Ontario will enforce an employment non-solicitation clause where it is:
- Clear and unambiguous
- Limited in time, scope, and target
- Directed at protecting a legitimate business interest (e.g., client relationships, donors, confidential information)
What Makes a Non-Solicitation Clause “Reasonable”?
When an employer tries to enforce a non-solicitation clause, a court will look at three main questions:
(a) Is there a legitimate business interest?
You must be protecting more than just a dislike of competition.
Legitimate interests include:
- Client, customer, donor, or member relationships
- Goodwill and brand built over time
- Confidential business or fundraising information
- Specialized training or access to strategic plans
Courts are especially sympathetic where the employee was the “face” of your organization to key clients, donors, or partners.
(b) Is the clause clear and specific?
The clause must be drafted so that an employee (and a judge) can understand exactly what is prohibited.
Common drafting problems courts have struck down:
- Vague phrases like “doing business with” or “having any dealings” without defining “solicit”
- Overbroad terms like “any actual or potential client” with no limits
Ambiguous territory or scope, similar to the non-compete issue in Shafron v. KRG Insurance Brokers (Western) Inc., where the SCC invalidated a covenant using the undefined term “Metropolitan City of Vancouver”.
(c) Is the restriction limited and proportionate?
Courts ask whether the clause goes no further than necessary.
They will examine:
- Time period: For employment, 6–24 months is common; the longer the period, the more justification you need.
- Who can’t be solicited: Narrowly targeting clients, donors, or partners the employee actually dealt with is far more defensible than “anyone who has ever done business with us”.
- Activity restricted: Focus on active solicitation, not passive receipt of business.
Ontario cases like Donaldson Travel Inc. v. Murphy and MD Physician Services Inc. v. Wisniewski show courts carefully analyzing whether an employee’s social media posts or announcements amounted to “solicitation”, often distinguishing between a general notice and targeted outreach.
🔎 Quick Checklist for Reasonable Non-Solicitation Clauses
A non-solicitation clause is more likely to be enforced if it:
- Targets clients/customers/donors the employee had direct dealings with in a defined period (e.g., last 12–24 months)
- Lasts for a reasonable time after departure (often 12–18 months)
- Prohibits active solicitation, not all contact or passive acceptance of work
- Is tailored to the employee’s role and your sector
- Is written in clear, specific language
How Non-Solicitation Clauses Work in Practice
For Ontario employers (including non-profits), non-solicitation clauses typically fall into two categories:
1) Client / Customer / Donor Non-Solicitation
These clauses prevent a former employee from approaching people or organizations they dealt with on your behalf, for the purpose of:
- Moving their business, donations, or membership to a competitor or their own venture
- Persuading them to end or reduce their relationship with you
For non-profits and charities, this may extend to:
- Donors and sponsors
- Members
- Program partners and affiliates
2) Employee / Contractor Non-Solicitation
These clauses prevent a departing employee from:
- Encouraging your staff, contractors, or volunteers to resign and join them or a competitor
- Poaching key team members is critical to your operations
Courts look more favourably on these clauses where they are limited to people the employee actually worked with or supervised.
Common Drafting Mistakes Employers Should Avoid
Ontario courts will not “fix” a badly drafted clause. If it is too broad, vague, or harsh, they will usually strike it down completely rather than rewrite it.
Frequent problems include:
- Overreaching scope: Restricting the solicitation of every client the organization has ever had, regardless of whether the employee had contact.
- Excessive duration: Multi-year restrictions for junior roles with limited client exposure.
- Unclear definitions, failing to define “client”: “prospective client”, or “solicit”.
- Blurring non-solicit and non-compete: drafting the clause so broadly that it effectively prevents the employee from working in their field at all.
For non-profits, another red flag is trying to restrict contact with the entire donor community or sector, rather than a targeted group whose relationship was actually developed through your organization.
Enforcement: What Happens If an Employee Breaches a Non-Solicitation Clause?
If you believe a former employee is breaching a non-solicitation clause, options may include:
- Cease and desist letter: Often, the first step is to put the employee and any new employer on notice.
- Injunction: In clear cases of ongoing solicitation, you may ask the court for an urgent order stopping the conduct.
- Damages: You may seek compensation for lost profits, diverted business, or harm to goodwill.
Courts will look at:
- The strength and clarity of your clause
- Evidence of actual solicitation (emails, messages, call logs, social media activity)
- Whether your own hands are clean (e.g., fair treatment of the employee, up-to-date contracts)
Enforcement is easier if you have good documentation, including signed agreements and records of which relationships the employee handled.
Practical Tips for Ontario Employers (For-Profit and Non-Profit)
For all employers:
Audit your templates
- Many non-solicitation clauses predate the ESA’s non-compete ban and may be outdated or overbroad. Have current contracts reviewed.
Tailor by role
- A senior fundraiser, sales lead, or program director needs a different clause than a junior administrator.
Pair with other protections
- Use non-solicits alongside confidentiality clauses, IP provisions, and clear conflict-of-interest policies.
Use onboarding and exit processes
- Explain the clause when the employee signs, and remind them of it on departure.
For non-profits and charities:
- Clearly define who counts as a donor, member, sponsor, or partner for non-solicitation purposes.
- Focus on relationships the employee wouldn’t have had but for your organization.
- Avoid clauses that would effectively block the employee from working anywhere in their field of service or advocacy.
As Christopher Achkar, employment lawyer and founder of Achkar Law, explains:
“Non-solicitation clauses can protect your business relationships, but only if they’re carefully drafted to comply with Ontario law. Employers should consult a lawyer before enforcing these clauses to avoid costly disputes.”
When to Speak With an Employment Lawyer
You should get legal advice if:
- You’re updating employment agreements after Ontario’s non-compete ban
- You’re acquiring a business or program and want to protect the client/donor base
- A key employee is leaving for a competitor or starting their own venture
- You suspect a former employee is soliciting your clients, donors, or staff
An employment lawyer may sometimes assist employees in challenging overreaching clauses, but on the employer side, most of the real value comes from proactive drafting and early strategic advice, before relationships and revenue are at stake.
Need Help with Non-Solicitation Clauses in Ontario?
At Achkar Law, we help employers across Ontario, including non-profits, charities, and businesses, draft, review, and enforce non-solicitation clauses that courts are more likely to uphold.
We can:
- Audit your existing employment agreements
- Draft clear, enforceable non-solicitation language tailored to your organization
- Advise you when a key employee resigns for a competitor
- Act quickly if you suspect unlawful solicitation of your clients, donors, or staff
If you’d like to strengthen your protections without overreaching or breaching current Ontario law, contact us to discuss your situation and options.
The article in this client update provides general information and should not be relied on as legal advice or opinion. This publication is copyrighted by Achkar Law Professional Corporation and may not be photocopied or reproduced in any form, in whole or in part, without the express permission of Achkar Law Professional Corporation. ©