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When are non-compete/non-solicitation agreements enforceable?

On Behalf of | Sep 8, 2022 | Business & Commercial Litigation

Competition is an integral part of Florida’s economy, but it means that companies need to find a way to differentiate themselves from the competition in order to stay in business. They do this not only through offering unique products and services, but also by working hard to build lasting relationships with their clients and customers.

Many businesses have employees that create and maintain these relationships and also have access to the business plans that can set the business apart from the competitors. These employees do not always stay with one company for their entire careers and they commonly leave for other employment opportunities at some point.

Companies have a strong interest in ensuring that former employees do not harm the business by providing their knowledge to competitors or by taking their clients with them. To protect against that, companies have their new or existing employees sign non-compete and non-solicitation agreements. These restrict their employers from harming the company after they leave. However, there is also an interest to ensure that people are able to find jobs in the area that will allow them to earn a living.

Elements of valid restrictive covenants

To balance these two competing interests, in order for these restrictive covenants to be enforceable they must meet certain requirements, which according to Florida law include, but are not limited to:

  • The restrictive covenants must be in writing and signed by the employees
  • It must be in place to protect a legitimate business interest, which can include trade secrets, confidential business information; relationships with current clients and customers; specialized training for the specific type of business and other valuable information
  • It must not restrict too large of a geographic area
  • It cannot restrict employment for too long of a period of time

Business in Florida can be very competitive and businesses rely on their relationships and unique differences of their products or services to survive and thrive. That is why it is important that non-compete and non-solicitation agreements are drafted correctly to ensure that the company can enforce them if needed. These restrictive covenants are useless if they do not meet the requirements and are not enforced in court. Experienced attorneys understand these covenants and may be helpful.