Under Florida law, non-compete agreements are considered restraints of trade and are strictly construed according to our Statutes. Non-compete agreements must have consideration to support them and must be reasonable in their geographic scope and time limits. Consideration for a non-compete can be the job, if entered into at the start of the job, otherwise they generally have to have some other consideration, like an increase in pay or a bonus. Whether a non-compete is reasonable in its geographic and time scopes depends on the specific situation and what interests are to be protected. When the Law Office of David Steinfeld drafts a non-compete for a business, for example, it will include factual explanations of the reasoning for these limitations to guide the Court and enhance the enforceability of the document.
So, if you have a non-compete and have left that job, it depends on the language in the agreement and the particular circumstances of the situation as to what you can and can not do. For example, if there was a written employment agreement and the employer breached that, the non-compete tied to it may not be enforceable. However, if there was no such agreement and the employee quit, then the non-compete may be enforceable as long as it has the requisite consideration and is reasonable in its limitiations.
Whether the limitations in a non-compete are reasonable is generally a factual determination for a Judge. For that reason, the non-compete agreements that the Law Office of David Steinfeld prepares have the agreed facts embedded in the document. Without that, the employer usually must provide separate evidence to prove the reasonableness unless it is specifically deemed reasonable by Statute. Agreements that limit future employment for one year or less and generally automatically reasonable. Those that are between one and two years after employment are usually enforced. Agreements that go beyone two years after employment are subject to review by our Courts. That is not to say an employer can’t have a five year non-compete, it is just that there has to be a legally valid reason to impose such a restriction on a former employee.
Non-compete agreements can also be temporarily suspended if they are violated. A series of cases in Florida has determined that if a party subject to a valid non-compete breaches the agreement, the employer isn’t getting the full benefit of the limitations so while the breach is ongoing, the limitations can be suspended until the breach stops, which then restarts the limitation from that point.
What you can and can not do then depends on the agreement you signed and the particular circumstances. Non-compete agreements may also be married with non-disclosure agreements that will also restrict use of specific knowledge gained during employment. Non-disclosures are not subject to the same limitations as non-competes and are often much broader as they are designed to protect proprietary information of the business.
The best thing to do is consult with a Board Certified expert in business litigation or in labor and employment law before you, as the employee, undertake actions that may subject you to liability or before you, as the employer, hand a non-compete or non-disclosure to an employee to sign. You can easily find such professionals through the Florida Bar’s website – flabar.org or through a local Bar Association, such as the Palm Beach County Bar- palmbeachbar.org.
As an employer, if you suspect that a former employee subject to either a non-compete or non-disclosure or both, is violating the agreement, the best initial action is to consult with a Board Certified expert in business litigation or in labor and employment law before you undertake any action. You, as the employer, must understand your rights and comprehend how the legal process allows for enforcement of these agreements. Also, as an employer, you are best served to have a Board Certified expert in business litigation draft these non-competes or non-disclosures for your business to know that they will be enforceable in your local courts when and if the time comes.
The worst feeling is preparing these documents on your own to save some money and finding out later that they are utterly unenforceable and that your former employee is now free to compete with your business armed with all the knowledge and experience your business has imparted to that individual. Be smart, plan ahead, and consult with a Florida Bar Board Certified expert in business litigation.