As a Florida business owner, it’s important to take steps to protect your confidential processes and product information. Many businesses use non-compete agreements to help ensure that former employees can’t use proprietary information for the benefit of other entities. Non-compete agreements can help safeguard a business’s interest. However, because they limit post-employment activity, they have specific requirements that must be met in order for them to be enforceable. If your business uses non-compete agreements, it’s important to understand how they are enforced. Here is more on enforcing a Florida non-compete agreement:
Florida Non-Compete Agreement Requirements
Non-compete agreements are contracts that prohibit an employee from starting a competitive business or working for a competitor for a certain amount of time in a certain capacity after they leave employment. These agreements are legally binding. However, they have strict requirements under the law that must be met in order for them to be enforceable.
When is a Non-Compete Agreement Enforceable?
To be enforceable, Florida non-compete agreements must be:
- “[R]easonable in time, area, and line of business.”
- “[I}n a writing signed by the person against whom enforcement is sought” and
- “[S]upported by evidence of the existence of one or more legitimate business interests justifying the [agreement].”
Someone seeking to enforce a non-compete agreement must be able to demonstrate its reasonableness, meaning that its duration, the geographic area it covers, and business area are within appropriate limits. In addition, the business owners must also be able to show that the employee signed the agreement and that it has a legitimate business reason for its use and implementation.
Florida law provides that an agreement that is six months or less is generally presumed reasonable and that a non-compete agreement lasting more than two years is unreasonable. However, this presumption can be rebutted.
Legitimate Business Interest
Florida law defines a “legitimate business interest” as including but not limited to”
- Trade secrets, as defined in Florida Statute 688.002(4).
- Valuable confidential business or professional information that otherwise does not qualify as trade secrets.
- Substantial relationships with specific prospective or existing customers, patients, or clients.
- Customer, patient, or client goodwill associated with:
- An ongoing business or professional practice, by way of trade name, trademark, service mark, or “trade dress”;
- A specific geographic location; or
- A specific marketing or trade area.
5. Extraordinary or specialized training.
When a non-compete agreement is not supported by a legitimate business interests, it will be considered is void and unenforceable.” The same is true if the agreement is too broad and overly restrictive of the employee’s ability to work.
Enforcing a Florida Non-Compete Agreement
Before enforcing a non-compete agreement, it’s important to consider what type of post-employment activity can be restricted. For example, agreements that prohibit an employee from working in a certain capacity within the same industry are usually reasonable and therefore enforceable. However, those that keep someone from working for a competitor in a general capacity would not be considered reasonable.
If you plan on using non-compete agreements with your employees, it’s important that you work with an experienced Florida business attorney to develop and draft your contract. Your business lawyer can help you create an enforceable agreement that protects your interests.
So, what happens when an employee violates their non-compete agreement? If you believe a former employee has violated their agreement, the first step is to gather all documentation and other evidence and contact an experienced Florida business attorney. Next, you and your lawyer can review the situation and determine your remedies. Depending on the circumstances, you may need to take legal action to stop your former employee. You may also have a claim for contract damages. However, resolving the matter through business mediation, arbitration, or negotiation may also be possible.
When a former employee uses your proprietary information, time is usually of the essence. Additionally, there is a statute of limitations for pursuing breach of contract claims under Florida law. Therefore, you will want to act as soon as possible to protect your interests. Contact an experienced Florida business attorney today to discuss your concerns regarding enforcing your non-compete agreement.
Contact an Experienced Florida Business Attorney
Attorney Richard Sierra at the Florida Small Business Center assists clients like you with commercial leasing, business, and litigation matters. As always, Our Goal Is to Help You Succeed™. For an appointment, you may call us at 1-866-842-5202 or use the contact form on our website. We represent clients throughout the State of Florida, including Coral Springs, Coconut Creek, Boca Raton, Delray Beach, Pompano Beach, Sunrise, Fort Lauderdale, Miami, West Palm Beach, Jupiter, Deerfield Beach, Stuart, Port St. Lucie, Orlando, Naples, Fort Myers, Sarasota, Tampa, and surrounding communities.