Non-competition Agreements & Florida Business Lawsuits: Employee Rights vs. Company Business Plans
It is common for businesses to ask their employees to make “non-competition agreements.” Such an agreement restricts the employee from working in the same industry (1) within a certain physical region or distance; and (2) for a period of time after terminating employment.
Employers use non-competition agreements to protect their investment in human resources. When employees are trained and gain experience, they unavoidably learn all about the business, including information that may be a “trade secret” that is not known to other competing businesses. They also interact with customers and may have access to valuable customer or client lists. Employers want to prevent this information from being used by a competitor.
In Florida, courts can enjoin a former employee from working in violation of a non-competition agreement. Courts can also award damages, attorneys’ fees, and costs.
On the other hand, the requirements of a non-competition agreement can be extremely onerous. Preventing a wage-earner from working, earning a living, and supporting a family, is a drastic remedy. It keeps an otherwise-productive member of the community from participating in commerce.
For these reasons, there are legal limitations on non-competition agreements. Courts are often reluctant to enforce them, and litigation over their enforceability is common. Persons who are subject to non-competition agreements have a variety of potential available defenses.