California Non-Compete Agreement

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A California non-compete agreement is prohibited in California from restricting an employee to seek work in the same or similar field as the employer. An employer may only require that an employee cannot share trade secrets with any new employer or third (3rd) party, which is difficult to prove.

Legally Enforceable in California?

No, a non-compete is not enforceable in California if it restricts, in any way, an individual’s ability to work in a specific industry.

“Every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void” (BPC § 16600)

Non-Disclosure (NDA) & Non-Solicitation

A California employer may legally elect to have an employee authorize a non-disclosure (NDA) and non-solicitation agreements.

  • Non-Disclosure Agreement (NDA) – Prohibits an employee from sharing trade secrets with competitors and third (3rd) parties.
  • Non-Solicitation Agreement – Prohibits an employee from obtaining customers, clients, and employees from an employer.

Maximum Term

An employer can elect to have a non-disclosure or non-solicitation agreement for an indefinite period. If an employee violates a non-disclosure, action must be brought within three (3) years of the misappropriation (CIV § 3426.6).

Remote Workers

A California company cannot set a conflict of laws to another State so remote workers or any individual working outside the State can sign a non-compete. The remote worker will have the same protections as a resident of California (Application Group, Inc. v. Hunter Group, Inc. (1998)).

Laws (statutes)

Laws – Sections 16600-16607 (Business and Professions Code)