What Florida Job Seekers Need to Know About Non-Compete Agreements and Other Restrictive Covenants
In today's economy, many workers in a wide variety of fields find the process of seeking employment lengthy, and sometimes frustrating. If you've been looking for a job for a long time and finally receive an offer, it can be tempting to accept right away.
However, if your employer asks you to sign a non-compete agreement or other restrictive covenant, you should read it carefully and make sure you fully understand what you're agreeing to do. If you are still unclear, consulting a Florida business lawyer can provide you with a better understanding of the agreement.
Types of Restrictive Covenants
Competition in business is good for consumers, leading to innovation and a wide variety of quality and pricing within an industry. However, Florida state law does allow some legal agreements to restrict competition in limited ways, for reasonable business purposes. This can affect prospective employees, business partners, or consultants in several ways, depending on the type of agreement:
Non-compete agreements are common in many industries, and prevent an employee from learning from an employer, then applying that knowledge to open his or her own similar business down the street, or going to a competitor and using such knowledge against his or her former employer. While these may be common in your field, you should read the agreement carefully and make sure it doesn't overreach in terms of geographic or time limitations. Smaller, specifically defined geographic areas are preferable—say, the Port St. Lucie area, a 20-mile radius of Miami, or the southern half of the state, as opposed to the whole State of Florida or the entire East Coast of the United States (reasonableness depends on the circumstances of each employment). Time limits between six months and two years are generally considered reasonable.
While agreements that overreach in these terms are often not enforced by the State of Florida, proving that your agreement was unreasonable could mean an expensive and time-consuming legal battle. It's better to negotiate a reasonable agreement before signing.
These don't prevent you from entering the same industry after leaving your employer, but they do restrict you from doing business with your former employer's customers. In some cases, you may also be prohibited from seeking business opportunities with their vendors or employees. Like non-competes, these agreements should also be specific (e.g., limited to customers the employee worked with directly) and limited in duration.
Confidentiality agreements are also common pre-employment agreements. These simply prevent you from using confidential information necessary for doing your job outside of the business who provides you said confidential information – such as trade secrets, price lists, etc. In other words, if you work at a barbeque sauce company, you can quit and start your own barbeque business, but you can't use your former employer's secret sauce recipe. These agreements generally apply to specific, proprietary information—computer codes, formulas, sensitive financial or marketing information.
These specify that work created by an employee—a piece of art, computer code, literature, a formula, etc.—is to be owned by the employer. Without a work-for-hire agreement, in some situations, the creator (the employee) may have a claim to work she created, even if she was paid for her time. Before signing this type of agreement, you should carefully consider whether the compensation is enough to give up any claim to the product you will create, among other factors.
With any pre-employment agreement, it's important to understand the potential ramifications before signing, even if you are desperate for a job. In fact, it's sometimes even more important to consider your agreement carefully when you have been out of work for a long time. An employer could take advantage of your eagerness to obtain a job and add excessive restrictions to your agreement. While these restrictions may not be enforceable, proving that in court could cost you time and money down the road. For this reason, it's always best to consult a Florida business lawyer before signing an employment agreement.
ABOUT THE AUTHOR: Nico Apfelbaum
Nico Apfelbaum, Esq. is the managing attorney of Apfelbaum Law, a Florida law firm serving Port St. Lucie, Stuart, the Treasure Coast and assisting clients with matters throughout Florida. Apfelbaum Law provides a wide variety of legal services, including, family law, divorces, business and contract transactions and litigation, immigration, wills and estate planning, probate law, and real estate law. The attorneys of Apfelbaum Law will answer your questions, explain your options, and provide you with the tools and resources you need to make an informed decision
Copyright Apfelbaum Law
More information about Apfelbaum Law
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer. For specific technical or legal advice on the information provided and related topics, please contact the author.