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Non-Compete Agreement California

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  • Non-Compete Agreement California

    The employer is a Private Patrol Operator (Security Company) who provided armed, uniformed security officers to patrol Apartment complexes.

    The employees are hourly paid, with no stake or partnership in the company.

    Upon hiring, the new employee is required to sign a non-compete agreement, which in part reads;

    .... the undersigned employee hereby agrees not to directly or indirectly compete with the business of the Company and its successors and assigns during the period of employment and for a period of 1 year following termination of employment and notwithstanding the cause or reason for termination.

    The term "not compete" as used herein shall mean that the Employee shall not own, or operate, consult or to be employee in such business substantially similar to or competative with the present business of the Company or such other business as the Company may substantially engage during the term of employment.


    This suggests that if laid off a security officer could not engage in similar work with another PPO for a period of one year?
    Last edited by MedicLeo; 02-10-2011, 02:53 PM. Reason: spelling

  • #2
    You'd have to run it by an attorney. It seems overly broad to me though, especially since it doen't mention the distance it wants to limit you to. Courts in general don't look favorably upon non-competes, especially for entry level workers. But to find out what California courts think, you'd have to ask an attorney.

    Edited to add: "California Business and Professions Code section 16600 explicitly states: "Except as provided in this chapter, every contract by which anyone is restrained from engaging in lawful profession, trade or business of any kind is to that extent void." The law provides a right to work, but allows limitations such as using proprietery or confidential information to benefit yourself or another company. Further info is at http://codes.lp.findlaw.com/cacode/BPC/1/d7/2/1/s16601.
    I am not an attorney, and don't play one on TV. Any information given is a description only and should be verified by your attorney.

    Comment


    • #3
      Non-Compete Agreement California

      Thank you for the citation.

      I was aware of non-compete agreements related to the dissolution of partnerships and the sale of businesses, but had been unable to find anything that related to the conduct of employees who were not engaged in the management or ownership of the business. I apprecitate your information.

      Comment


      • #4
        In its long-awaited decision in Edwards v. Arthur Andersen, the California Supreme Court ruled on August 7, 2008 that California employers cannot enforce agreements limiting competition by former employees, except within very narrow statutory exceptions. The Court established this bright-line rule by interpreting broadly California Business and Professions Code section 16600, which prohibits contracts by which anyone is “restrained” from engaging in a lawful profession, trade or business. The Court held that Section 16600 prohibits not only broad post-employment noncompetes, but also “narrow restraints” on competition, such as agreements not to solicit clients of a former employer.

        Edwards’ significance

        Edwards draws a clear line and resolves a conflict between California and federal law. It advances California’s policy favoring open competition and employee mobility, and reinforces California’s longstanding position as the state that takes the narrowest view of the enforceability of employee non-competes.

        Following Edwards, employers should review all existing agreements and templates containing any restrictions on post-employment competition. Such agreements will not be enforceable in California unless they fall under one of the established statutory exceptions for noncompetes entered into: (1) in connection with the sale of a business, (2) among partners in a partnership, or (3) among members of a limited liability corporation. In addition, proprietary information agreements (prohibiting use or disclosure of confidential information and trade secrets) and agreements not to solicit employees of a former employer, remain enforceable in California and continue to be effective tools to limit unfair competition by former employees.

        I would still take your noncompete to an employment or contract attorney in your
        area for review.
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