Content Overview
Guide to Writing California Non-compete Agreement
Completing the California Non-compete Agreement form is a straightforward process. This form is essential for outlining the terms of a non-compete arrangement between an employer and an employee. Following these steps will help ensure that the form is filled out accurately and completely.
- Begin by gathering all necessary information, including the names and addresses of both parties involved in the agreement.
- Enter the date on which the agreement is being executed.
- Clearly state the purpose of the non-compete agreement. This should include a brief description of the business interests that need protection.
- Specify the duration of the non-compete clause. Indicate how long the employee will be restricted from competing after leaving the company.
- Define the geographic area covered by the non-compete agreement. Be as specific as possible about the locations where the restrictions apply.
- Include any additional terms or conditions that may be relevant to the agreement. This could involve details about compensation or other considerations.
- Ensure that both parties sign and date the form. Each party should retain a copy for their records.
After completing the form, review it carefully to confirm that all information is accurate. Once both parties have signed, the agreement becomes effective as outlined in the terms. Keep a copy for future reference.
PDF Form Specs
| Fact Name | Details |
|---|---|
| Legality | Non-compete agreements are generally unenforceable in California, except in limited circumstances. |
| Governing Law | The California Business and Professions Code Section 16600 governs non-compete agreements. |
| Employee Rights | Employees have the right to work in their chosen profession without restrictions imposed by former employers. |
| Exceptions | Certain exceptions exist, such as in the sale of a business or in partnership agreements. |
FAQ
What is a California Non-compete Agreement?
A California Non-compete Agreement is a contract that restricts an employee from engaging in similar work or starting a competing business after leaving their current employer. However, California law generally prohibits these agreements, making them unenforceable in most cases.
Are non-compete agreements enforceable in California?
No, non-compete agreements are largely unenforceable in California. The state has a strong public policy against restricting an individual's right to work. There are a few exceptions, such as in the context of the sale of a business or the dissolution of a partnership, but these situations are limited.
What can an employer do instead of a non-compete agreement?
Employers in California often use alternative strategies to protect their business interests, such as:
- Non-disclosure agreements (NDAs): These agreements protect confidential information from being shared with competitors.
- Non-solicitation agreements: These restrict former employees from soliciting clients or employees of the business.
- Trade secret protections: Employers can rely on trade secret laws to safeguard sensitive information.
What is a non-solicitation agreement?
A non-solicitation agreement is a contract that prohibits an employee from soliciting customers or clients of their former employer for a specified period after leaving the company. Unlike non-compete agreements, these are more likely to be enforceable in California, provided they are reasonable in scope and duration.
How long do non-solicitation agreements last?
The duration of non-solicitation agreements can vary. Typically, they last between six months to two years after the employee leaves the company. Courts will consider the reasonableness of the duration based on the specific circumstances of the case.
What should I do if I signed a non-compete agreement?
If you signed a non-compete agreement, it's important to understand that it may not be enforceable in California. However, you should consult with a legal professional to discuss your specific situation. They can help you understand your rights and options moving forward.
Can I still work in my field after leaving my job?
What are the penalties for violating a non-compete agreement?
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California Non-compete Agreement Example
California Non-Compete Agreement
This Non-Compete Agreement ("Agreement") is made and entered into as of [Date], by and between:
[Employer's Name], a corporation with its principal place of business at [Employer's Address] ("Employer")
and
[Employee's Name], residing at [Employee's Address] ("Employee").
In consideration of the employment or continued employment, the parties agree as follows:
- Purpose: The purpose of this Agreement is to protect the legitimate business interests of the Employer.
- Non-Compete Obligation: The Employee agrees not to engage in any business, trade, or profession that competes with the Employer's business within a distance of [Distance] from the Employer's location for a duration of [Duration] following the termination of employment.
- Confidential Information: The Employee acknowledges that he/she may have access to confidential information. The Employee agrees to keep this information confidential and not disclose it to any third party.
- Governing Law: This Agreement shall be governed by the laws of the State of California.
- Severability: If any provision of this Agreement is found to be unenforceable, the remaining provisions shall continue in full force and effect.
- Entire Agreement: This Agreement constitutes the entire agreement between the parties regarding the non-compete obligations and supersedes all prior agreements and understandings.
IN WITNESS WHEREOF, the parties have executed this Non-Compete Agreement as of the date first above written.
_________________________ _________________________
Employer's Signature Employee's Signature
_________________________ _________________________
Printed Name Printed Name
Date: _______________ Date: _______________