Hiring and training quality employees can be costly for your business. Therefore, it’s only natural that you want to protect your investment and prevent your employee from working for a competitor or starting their own business in the same industry.
Non-compete agreements are a powerful tool for businesses seeking to protect their competitive advantage. Many states have limited or outright banned non-compete agreements. Fortunately, Florida is employer-friendly and will enforce a non-compete agreement as long as it’s properly drafted.
A legitimate business interest
Florida allows non-compete agreements as long as they meet the following requirements:
- It’s in writing and signed by the employee
- It protects a legitimate business interest
- It’s reasonable regarding time, geographic area and scope
A legitimate business interest may be:
- Trade secrets or confidential business information
- Relationships with specific clients
- Specialized training provided to the employee
- Proprietary business processes
Florida considers six months or less to be reasonable. The geographic restriction is limited to where the employer actually does business. Overly broad restrictions, such as a statewide ban without justification, are unlikely to be enforceable under the law. The employee can only be prevented from engaging in activities that compete with the employer. Trying to keep a former employee from working in an unrelated industry is likely to be challenged.
If an employee leaves your company to work for a competitor or start their own business in the same industry, you may be able to seek an injunction that would stop the former employee from violating their non-compete. You don’t need to show actual financial loss for it to go into effect.
Common mistakes that can undermine the enforcement of a non-compete agreement are:
- Failing to define legitimate business interests
- Trying to impose strong restrictions
- Waiting too long to take action after a violation
- Inconsistently enforcing the agreements among employees
If you believe a former employee is violating a non-compete agreement, you should reach out to a legal representative who can review the contract for enforceability and help you obtain an injunction.