Q: I heard that companies entering into commercial contracts in Pennsylvania can no longer restrict each other from hiring their employees. Is that true?
A: On April 29, the Supreme Court of Pennsylvania held in Pittsburgh Logistics Systems, Inc. v. Beemac Trucking LLC, et. al. that a no-hire provision (commonly referred to as a “no-poach” provision) in a service contract between two business entities was unenforceable as an impermissible restraint of trade because it was overbroad and created a likelihood of harm to nonparties to the contract (i.e., affected employees and the general public). This decision comes at a time where there has been considerable concern that no-poach agreements violate federal and state antitrust laws. In this case, however, the Court did not conclude that all no-hire provisions found in commercial contracts are void as a matter of state law.
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