As a small business owner, you spend a lot of time hiring, training and mentoring employees. You count on your employees to help your business succeed. At some point, you may consider having key employees sign noncompete agreements – to avoid having them go work for a nearby competitor and taking some of your clients with them. However, you’ve heard that sometimes, noncompete agreements are not enforceable. How well can you enforce a noncompete agreement in Florida?
Enforcing noncompete agreements
Each state has different laws regarding when employers can enforce noncompete agreements. For example, in California, it’s very difficult to enforce noncompete agreements. The state takes a very employee-friendly stance, not wanting to prevent someone from being able to work. However, in Florida, noncompete agreements must meet two standards:
- They must be reasonable in time, area and line of business.
- They must protect a legitimate business interest.
Examples of protecting legitimate business interests include:
- Protecting trade secrets
- Protecting valuable confidential information
- Protecting substantial relationships with customers, clients or patients
- Paying or providing for an employee’s specialized training
Two potential drawbacks from having employees sign noncompete agreements is that you may have problems recruiting new employees or you may hasten the exit of an employee you want to sign a noncompete agreement if they haven’t before.
Seeking counsel about noncompete agreements
If you want to avoid a dispute down the road, you should consult an experienced business law attorney before having an employee sign a noncompete agreement. An attorney can draft a noncompete agreement that is reasonable and less likely to face legal challenges. An attorney also can advise you on other ways to protect your trade secrets and confidential business information.
As a business owner, protecting your business is a key part of your responsibilities. Having key employees sign noncompete agreements may benefit your business in the long run and help you avoid losing valuable employees and clients to competing businesses.