EMPLOYMENT CONTRACTS .97 be struck down by the courts. For example, unreasonable covenants have been held to be unenforceable by injunction under New jerse 7 law as established in the leading case of Sternberg rs. O'Brien (4). Al- though discussion of the unenforceability of the agreement in the case is dictum, the reasoning behind the decision has been repeatedly followed in New Jersey (5). The development of the law of employment contracts has resulted from an attempt by the courts over the years to balance two conflicting elements essential to our society. There is a strong policy favoring free competition, for an employee is entitled to use the skill and knowledge of his trade or profession which he has learned or developed in the course of any employment for the benefit of himself and the public, provided he does not violate a contractual or fiduciary obligation in doing so. On the other hand, in order to promote the orderly progress of science and the useful arts, the law provides certain protections as safeguards against breaches in employee incurred obligations. Among these protections are the patent and copyright statutes and the law of torts prohibiting unfair competition. The law protecting trade secrets is another related protection afforded by the law. An examination of the holdings of the common law dealing with em- ployment contracts will suggest the presence of a persistent distaste for all contracts in restraint of trade. Nevertheless, the courts usually up- held the validity of covenants by an employee not to compete with his former employer upon termination of the employment as well as the validity of covenants of a vendor of a business not to compete with the yendee. Obviously, an employee is more apt than a vendor to be coerced into an oppressive agreement, and therefore the courts were more apt to construe strictly the terms and provisions of a covenant ancillary to an employment contract. The more recent court holdings have considered the after-employ- ment or holdover clauses of an employment contract with a view toward what is considered to be the reasonableness of the provisions after ex- amination of all the pertinent facts. Overriding these basic policies are the more practical guidelines of time and area limitations, although most employment contracts do not contain specified area limitations. During the period of employment, the employee is bound by the non- disclosure clause and may not reveal any confidential information en- trusted to his confidence, even though such information is not specifically considered or classified by the employer as a trade secret. When, how- ever, the employee's services are terminated, his rights of disclosure are

O8 JOURNAL OF THE SOCIETY OF COSMETIC CHEMISTS usually restricted to information which is in fact considered by the courts to constitute a trade secret. The ban, therefore, against dis- closure of trade secrets during employment is much stricter than is the ban against disclosure of trade secrets after employment has ceased. An accurate definition of what constitutes a trade secret is difficult to formulate, although the Restatement of Torts (6) seems to present as accurate a definition as is available. The Restatement describes a trade secret as follows: A trade secret may consist of any formula, pattern, device or com- pilation of information which is used in one's business, and which gives him an opportunity to obtain an advantage over competitors who do not know or use it. It may be a formula for a chemical com- pound, a process of manufacturing, treating or preserving matehals, a pattern for a machine or other device, or a list of customers. The more precise question of whether or not a trade secret exists and, if there is, whether the owner of the secret will be protected against its unlawful disclosure has been considered in numerous cases (7) and has also been greatly analyzed by text writers (8). The legal principles are not in great dispute either in the case law or that of the text writers, but it is the application of the legal principles to the particular set of facts on which the decision must turn which presents great difficulty. The Restatement (9) sets forth some elements useful for considera- tion in determining whether a trade secret, in fact, exists. These ele- ments include: (a) The extent to which the information is known outside of his business (b) The extent to which it is known by employees and others in- volved in his business (c) The extent of measures taken by him to guard the secrecy of the information (d) The value of the information to him and to his competitors (e) The amount of effort or money expended by him in developing the information (f) The ease or difficulty with which the information could be properly acquired or duplicated by others. Much of what has been stated so far has been concerned primarily with the employer-employee relationship during the period of employ- ment. Now we come to the time in an employee's life when, after at-