California Non-Compete Agreement

If you have been asked to sign a non-compete agreement at work in California, it is vital that you consult a California employment attorney as soon as possible to address this clause of your employment contract. The attorneys at Aitken Campbell Heikaus Weaver, LLP, can provide legal guidance if you believe that a standing contract will be rendered unlawful after the new law comes into effect.

Non-compete agreements have been commonly used across all industries in the United States with the intent of preserving competitive advantages. When an employer requires an employee to sign a non-compete agreement, this is basically a contract stipulating that. if the employee leaves the company for any reason, they agree not to work for competing employers or even within the same industry.

These agreements have been widely decried as unfair toward employees, forcing them to seek alternative work outside their preferred field after leaving a company. Non-compete agreements have led to diminished earning capacity and even civil claims from employers who believe that previously signed agreements have been violated.

New Law for Non-Compete Agreements in California

California Governor Gavin Newsom recently signed Senate Bill 699 into law, effectively banning non-compete agreements in the state of California. There has been strong opposition to non-compete agreements in California and throughout the U.S. for many reasons, but the primary argument against them is that they limit employee mobility and solely benefit employers in an unfair way.

As of January 1, 2024, these agreements are not only no longer legally permissible in the state, but the new law also renders all previously signed non-compete agreements null and void. All California employers have until February 24, 2024, to notify their current and previous employees that any signed non-compete agreements are no longer valid.

What Effect Will SB 699 Have?

An additional detail of this law that all employees must understand is that it prevents enforcement of non-compete agreements in California, even if an employee signed such an agreement with an employer in another state. However, it remains to be seen how any out-of-state employers may attempt to resolve such issues pertaining to non-compete agreements.

Currently, there are a few small sections of the California Labor Code that technically allow for the enforcement of standing non-compete agreements, but SB 699 will effectively render these arguments moot.

Filing a Breach of Contract Complaint Under California’s Employment Laws

Whenever an employee enters a contract with an employer, both parties have specifically outlined rights and responsibilities under the terms of the contract that both must follow. If you have been asked to sign an unlawful or legally unenforceable contract, or if your employer has attempted to enforce a non-compete agreement you previously signed, you may be entitled to compensation.

Employers who have pursued legal recourse against employees who have violated non-compete agreements have traditionally sought compensation for lost profitability or punitive damages for breach of contract. In most non-compete agreements, the agreement will stipulate that, if the signing employee violates the agreement, they are:

• Agreeing to pay a certain amount of damages
• Restricting resolution of the dispute to arbitration managed by the employer

Most of these contracts are constructed in a one-sided manner to give the appearance that the employee has little ground to argue their side of the issue. However, an experienced California employment attorney can help you prove that a standing contract is unenforceable. If a past employer has restricted your mobility concerning new job opportunities, you may have grounds to claim compensation for lost income and other damages.

Legal Counsel for Employees in California

If your employer has asked you to sign an unlawful or unenforceable non-compete agreement or any other contract, an experienced California employment attorney is the ideal resource to consult. Your attorney can review the contract in question and determine whether any element will be impacted by SB 699.

The attorneys at Aitken Campbell Heikaus Weaver, LLP, can provide comprehensive legal counsel for all aspects of a contract dispute case. We can also help you determine the optimal way to address any accusations that you have violated a non-compete agreement in California. While the law currently allows a narrow window of enforcement of these agreements under the California Labor Code, your attorney can help you fight unjust legal reprisals from a past employer.

Legal Counsel for Employers in California

Contract review is an essential part of running a business in California. If you are an employer in any industry, an experienced California employment attorney can help you draft your employee contracts to ensure that they fully comply with the California Labor Code and the newly passed SB 699. Aitken Campbell Heikaus Weaver, LLP, provides various professional employer services that can help you run your business on a sound legal footing.

Our team can carefully review your goals for your business and address the various legal issues that you might encounter pertaining to employment agreements and other contracts between you and your employees and contractors. This legal counsel is invaluable because it can prevent your company from being impacted by future legal actions from employees and other legal penalties.

What to Expect From Your California Employment Attorney

When you choose Aitken Campbell Heikaus Weaver, LLP, to represent your case, you have a responsive legal advocate readily available to assist you with every aspect of a contract dispute or any other legal issues related to a non-compete agreement that you previously signed.

As of now, any standing non-compete agreements have a very limited time in which they may be enforced. As of January 1, 2024, all such agreements will be null and void, but this may not deter an employer from pursuing legal action against any employee who violates such an agreement. If you find yourself in this situation, a good attorney can help you have any such legal actions dismissed as frivolous or explore alternative avenues of legal recourse.

Legal Representation for Non-Compete Agreement Disputes in California

If you have suffered damages from any breach of contract or unenforceable non-compete agreement in California, we can help you determine the most viable legal remedies available to you. Our team can help if you have any legal questions concerning a non-compete agreement in California or how the new SB 699 may affect you. Contact Aitken Campbell Heikaus Weaver, LLP, today to schedule a consultation.