In competitive markets like Florida, entrepreneurs have to stay up to date with innovation and hard work to deal with the constant pressure of numerous businesses providing the same goods and services.
However, it is necessary to ensure fair competition between all players, which means no player can dictate or cheat the market.
Many employers in Florida utilize non-compete agreements to protect their business’s best interest, in case an employee leaves the company and finds a job with a competitor.
Back to Basics – Understanding the Concept
A non-compete agreement is a type of contract used by employers to protect a legitimate business interest. In layman’s terms, an employer makes an employee sign an agreement not to work for another business within the same industry for a limited period after leaving the company.
Business owners use non-compete agreements as a tool to prevent former employees from using their knowledge and contacts for the benefit of competitors.
Legitimate Business Interest
As provided by Florida law, a non-compete agreement can only protect legitimate business interests, including:
- trade secrets,
- valuable confidential business or professional information that otherwise does not qualify as trade secrets, and
- substantial relationships with specific prospective or existing customers, patients, or clients.
Also, it requires the customer, patient, or client goodwill to be associated with:
- an ongoing business or professional practice, by way of a trading name, trademark, service mark, or “trade dress.”,
- a specific geographic location,
- a specific marketing or trade area, or
- extraordinary or specialized training.
In case an ex-employee challenges a non-compete agreement in Florida, the employer has the burden to prove that the contract protects one or more of these interests.
Plus, the employer must demonstrate that the specified restraint is strictly necessary to protect the business’s interests.
How a Non-Compete Agreement Can Affect an Employee?
Even though non-compete agreements are a protective manner employers have to safeguard their legitimate business interests, sometimes employees may feel punished after signing this type of contract.
In some cases, employees who signed a non-compete agreement face hardship when trying to find other meaningful work in their area of skill and expertise.
In this sense, it is crucial to know all the terms of the agreement in detail before signing it. Plus, it is fundamental to know what defenses to use if the agreement derails in the mid-term, causing problems to the employee’s career after leaving the employer.
Are Non-Compete Agreements Enforceable in Florida?
While not every state permits the enforcement of such type of agreement, Florida is one of the exceptions. Hence, we recommend you seek guidance from an expert attorney to oversee your case, either if you are going to sign it or if you already did it.
Any employer who opts to utilize a non-compete agreement is expected to follow some elements when drafting the restrictive covenant. In case any of these elements are unreasonable, the agreement will be considered unenforceable in the court.
Employers need to allow employees a reasonable opportunity to work at another business in the same industry in case they leave the company.
Time and Geographic Restrictions
The core of an enforceable non-compete agreement is reasonability. Employers need to pay attention to detail when drafting this type of contract, especially when it comes to the length of time and geographic area that will be restricted.
In Florida, any restraint six months long or less is considered presumably reasonable. Restraints with periods exceeding 2 years are presumed unreasonable. However, there are cases in which a court has enforced a restraint with a length exceeding 2 years.
The geographic location restricted in the agreement can be determined by county, distance, or geographic area. For instance, a former employer who does not conduct any type of business activity within the area covered by an agreement will not be able to enforce it out of its area.
How to Defend Against a Non-Compete Agreement?
When an employee has already signed the agreement, it is crucial to seek guidance from an expert attorney to prepare a defensive strategy. Each case is different, but in most cases, the terms of the agreement may be unenforceable.
However, there are other ways out of a non-compete agreement, such as when the court prevents an employer from enforcing the terms of a non-compete agreement because he/she engaged in unlawful activity.
- Illegal discrimination.
- Contractual breach.
- Illegal conduct by the employer.
- Request/incentive to an employee to engage in illegal conduct.
Be aware that a non-compete agreement can affect your livelihood for a certain period, which will impact your career and your personal life.
Non-Compete Agreements in Florida – We Can Help You
Dealing with a non-compete agreement is a demanding task. Whether you are an employer or employee, contact us, and we will provide a feasible strategy for your case.