In contract law, a non-compete agreement is a written contract between the employer and the employee in which the employee agrees not to enter into any competitive business with the employer subsequent to being terminated from his/her employment. Non-compete agreements are generally formed in order to protect the employer from competition. This includes preventing the employee from revealing any sensitive information with regard to the employer’s trade secrets, operations, clients, formulas, strategies, methods, practices, ideas, future products, marketing plans, etc. But how far can we go in order to protect our business?
Florida Statute section §542.335 lays out the types of information that may be protected pursuant to a non-compete agreement, restrictions that may be imposed, how these agreements are interpreted by the court, and the burden of proof imposed on the party seeking or opposing enforcement of the non-compete agreement. For your convenience, the link is as follows:
There are three types of restrictions that are generally considered by the court when determining whether or not a non-compete agreement is enforceable.
- Type of Employment: This section discusses the types of employment the employee can enter into during the term of the non-compete agreement. Whether or not a particular restriction can be imposed depends on the job/industry the employee works in.
- Location/Distance: This section discusses the geographical restriction imposed on the employee. This restriction must be reasonable and depends on the type of business that is seeking to enforce the non-compete agreement.
- Duration: This section discusses how long an employee must wait before they can seek employment from a competing business. The time restriction must also be reasonable. Florida’s non-compete statute, Fla. Stat. § 542.335, creates rebuttable presumptions as to when a non-compete agreement’s duration provision is enforceable. These presumptions provide that the court “shall presume” a non-compete agreement between an employee and employer is reasonable if the non-compete agreement is enforceable for 6 months or less. If an employee and employer enter into a non-compete agreement that is enforceable for more than two years, such agreements are presumed under the statute to be unreasonable.
If you have any questions or concerns in regard to drafting, reviewing, or enforcing a non-compete agreement, please contact Meglino Law at 407-900-7440.