Four Reasons Your Non-Compete Agreement Could Be Invalid In Florida
Many companies in Florida use non-compete agreements to help protect important confidential information relating to their business. When used properly, a non-compete contract is a very valuable legal too. However, all business owners and managers must understand that Florida courts will look at non-compete contracts with a skeptical eye. In fact, the terms of these contracts will not always be enforceable. There are many different reasons why your non-compete agreement may be found invalid in Florida, and the following is a list of four of the most common.
- The Employer Breached the Agreement
Remember, a non-compete agreement is a contract between an employer and another party. As such, it puts legal responsibilities on the employer, as well. If a business breaches their side of the deal in any way, the entire agreement may be found to be unenforceable. An employer’s breach of a non-compete can occur in many different ways. For example, if a business fails to pay an employee fully and on time, any corresponding non-compete agreement may lose its enforceability.
- There Is No Legitimate Business Interest Involved
Non-compete agreements are viewed as a restraints on trade or commerce. In Florida, restraints on trade can only occur in a narrow set of circumstances. Indeed, under Florida law, a non-compete contract must have a fundamental and legitimate business purpose. You may not use a non-compete agreement that is ‘overly restrictive’. The lesson here is simple: Employers must ensure that they do not overreach when drafting non-compete agreements. You should keep the agreement as narrow as it needs to be. By doing this, you can help to ensure enforceability.
- The Agreement Was Too Long
Florida courts will not accept non-compete contracts that last indefinitely. Generally, agreements should not be longer than two years. Though, that is not a hard and fast rule. However, if you are looking to use a longer agreement, you should be prepared to show good cause as to why your company needs a longer agreement.
- It Is Against the Public Interest
Finally, Florida courts may also strike down non-compete contracts that are determined to be against the goals of public policy. For example, when it comes to an important industry such as public health, a court may decide that a non-compete agreement is inappropriate. This is an issue for employers who operate in key areas such as health and public safety. To be clear, it is still possible to use non-compete agreements in these industries. However, it is critical that these type of companies have their agreements drafted by an experienced attorney.
Contact Our Office Today
At Pike & Lustig, LLP, our West Palm Beach business law attorneys have extensive experience drafting and reviewing non-compete agreements. We are also experienced in contract litigation. If your Florida business has questions about non-compete agreements, please reach out to our team today. Our team will review your case, free of charge. We represent businesses throughout the region, including in Coral Springs, Boca Raton, Oakland Park and Coral Gables.