Florida is known for its very employer-friendly non-compete laws (also known as the restrictive covenant statute), but if you’re an employer hoping to restrict workers from going to work for a competitor, you have to be very careful about any non-competes you attempt to enforce. Not only does potential harm to your business count, but so does the potential harm to the worker and to those the worker serves.
The restrictive covenant law in Florida allows employers to have workers sign, and to enforce if those workers violate, agreements that prohibit competing employment within a certain time frame and possibly within a certain radius of the original work site. Employers can make a very good case to enforce the non-compete if the worker’s new situation will harm the employer substantially.
For example, if a worker knows about your company’s trade secrets and tries to move to a competing company, you could argue that the move would harm your business because of the potential for the secrets to leak out. Or, if your worker helps several clients at your business and then tries to start his or her own business in the same field, you could argue that the risk of the worker stealing your clients is too great.
However, you can’t just claim these things; you have to show enough proof to satisfy the court. If you had the worker sign the non-compete simply to make quitting seem less attractive, the courts might side with the worker. In this case, the worker going to a similar company would not likely harm you, and you would have no reason to prevent the worker from using his or her knowledge to earn a living.
Another issue is that, if the worker is in another state, courts may side with the other state’s laws. This was the case with a Florida company employing a worker in New York. When the non-compete ended up in court, the New York courts ruled that the Florida non-compete conflicted with New York’s laws protecting the worker’s right to earn a living. The worker won the case.
Workers who also provide rare and skilled services could also successfully challenge a non-compete. This was the case with a Florida surgeon who was one of only 30 people nationwide who could provide a vital medical service. His new place of employment was too close per his non-compete agreement. Yet his skill was so specific that he successfully challenged the non-compete.
If your workers are independent contractors or freelancers, the situation becomes more complicated. The nature of contracting and freelancing often has workers bouncing between companies constantly, and for many, having multiple clients in the same field is the only way to make a living. Trying to enforce a non-compete with an independent contractor could be seriously harmful to the contractor’s ability to work depending on the requirements. If trade secrets or other information are at stake, consult with a labor attorney to draw up a suitable non-disclosure agreement instead.
For those situations when a non-compete is still desirable, though, talk to a lawyer about the best way to word the agreement so that your business interests are protected, and the contractor can still earn a living in his or her chosen field. It is possible to work out a suitable compromise.
