What Florida Business Owners Can Do About Unenforceable Noncompete Agreements
Written on December 8, 2020
Florida business owners invest substantial effort to hire, train, and develop their employees, which is why many protect their company’s interests through non-compete agreements. However, because of their implications on free trade, there are limitations under state law on contracts that restrict or prohibit competition. A court will not enforce a covenant not to compete unless it meets strict conditions, since the effects can have profound implications for the employee. If your non-compete contract does not comply – or if you did not have workers execute one – you might think you are out of options in terms of protecting your business.
Fortunately, you may still be able to exercise certain legal remedies that may help you achieve your objectives. You should discuss your circumstances with a Clearwater business litigation attorney who can tell you more about the laws, but an overview may be helpful.
Understanding Flaws in Non-compete Agreements
Before getting to the issue of what to do about an unenforceable non-compete clause, you should be familiar with why yours may be legally defective. Florida’s statute mandates that such contracts be “reasonable” with respect to duration, geographic area, and industry. They must also be intended to protect a legitimate business interest, as opposed to existing solely to inhibit competition. A legitimate business interest may be:
- Trade secrets, such as customer lists, intellectual property, company-developed processes, and customer relationships; or,
- Confidential business or professional information that does not qualify as a trade secret.
Options for Protecting Your Company’s Interests
If your covenant not to compete is lacking according to the statutory requirements, or if you do not have one, you may still be able to take legal action.
Florida courts have adopted the “blue pencil” approach to non-compete contracts, which means judges can revise or modify a provision that would otherwise violate the statute. When your agreement is unreasonable, you may convince the court to rewrite it and provide an appropriate remedy for breach.
Misappropriation of Trade Secrets
Your company has the right to protect its assets from theft, and your trade secrets are most certainly an asset. Florida has enacted the Uniform Trade Secrets Act, through which you can seek such remedies as:
- Injunctive relief to enjoin a former worker from disclosing or otherwise using trade secrets at another position in competition with your company;
- Enjoining the ex-employee’s new employer from using trade secrets;
- Monetary damages resulting from the misappropriation of trade secrets; and,
- Attorneys’ fees.
Many trade secrets theft cases turn on the lengths that a company goes to in terms of protecting the confidential nature of the information.
A Pinellas County, FL Business Litigation Lawyer Can Explain Your Options
While you may have options in the absence of an unenforceable non-compete agreement, it is still essential to retain knowledgeable legal counsel for assistance in pursuing them. Our team at Clearwater Business Law has the skills and experience to help you protect your company, so please call us at (727) 785-5100 to set up a consultation. Once we review your situation, we can advise you on strategies for covenants not to compete.