Restrictive covenants, often known as “noncompete agreements,” are more prevalent than ever due to increased employee mobility and the ease with which information can be transferred. However, workers and businesses often don’t understand the rules that control the enforceability of these documents. State law requires that restrictions be reasonable, but a New York court refused to apply the Florida standard and called it “truly obnoxious” because the statute prohibits judges from considering the economic hardship that a former worker might face. No matter what side of a restrictive covenant you’re on, it’s important to know your rights.
The relevant Florida statute places the initial burden on the business seeking to enforce a noncompete agreement by showing that certain factors exist, including:
- Legitimate business interest — In order to make a restrictive covenant stand, a former employer must indicate a legitimate business interest that is being protected, such as a trade secret or substantial relationship with existing customers.
- Reasonable geographic bounds — It is not in the public interest to have someone forbidden from practicing in their chosen field. Therefore, even if a company has an appropriate reason for restricting someone from competing within a given area, the geographic bounds may not be overbroad.
- Proper timeframe — A noncompete agreement that lasts for too long in the court’s opinion will be rejected. The relevant statute provides timeframe guidelines for various types of workers and business associates.
Like the New York court, many observers believe that the Florida law favors employers, because once they have met their legal threshold, a former worker cannot demonstrate how enforcement of the agreement will cause financial harm. However, an experienced Florida civil litigation attorney can often find ways to demonstrate that an unduly harsh restrictive covenant should not be enforced due to lack of reasonableness.
Frank Charles Miranda, P.A. represents individuals and businesses in matters relating to noncompete agreements and other civil litigation cases. Please call 813-902-3925 or contact us online to schedule an appointment at our Tampa office.