While Florida has a very pro-employer non-compete statute, it is not without its limitations. In a recent Florida Supreme Court decision, the Court held that Florida’s non-compete statute does not cover non-compete agreements “whose sole purpose is to prevent competition per se” because they would be void against public policy. White v. Mederi Caretenders Visiting Services of Southeast Florida, LLC, 226 So.3d 774 (2017).
How Are Non-Compete Agreements Enforceable in Florida?
For a non-compete agreement to be enforceable it must meet the five requirements set forth in Florida Statute § 542.335. A valid non-compete agreement must: (1) be in writing; (2) show the existence of at least one legitimate business interest; (3) be reasonable in time; (4) be reasonable in geographical area; and (5) be related to the specific type of business.
Business Non-Compete Agreement Issues
The existence of a legitimate business interest is generally the most litigated issue with non-compete agreements. The statute is unambiguous and states, “Any restrictive covenant not supported by a legitimate business interest is unlawful and is void and unenforceable.” Fla. Stat. 542.335. The statute provides a non-exhaustive list of legitimate businesses interests. But for interests not listed, it will be determined on a case-by-case basis whether the restriction is for a legitimate business interest. If the interest is determined to be legitimate, the employee will have the burden to show that the restraint is overbroad, overlong, or otherwise not reasonably necessary to protect that interest. Fla. Stat. 542.335(c).
It is pertinent that employers only have employees that possess knowledge which may disrupt their business interests sign noncompete agreements. Unless each employee has access to proprietary information, having a mass portion of the employees sign a noncompete could lead to its being challenged.
If you have employees in other states, it is important to note several other state courts’ laws. Some have refused to enforce choice of law provisions in employment agreements because of the Florida non-compete statute. Several states view Florida’s non-compete statue as too focused on employers’ rights and not employees’ rights. Those states have viewed the statute to be contrary to public policy and have applied local law instead of the Florida statute.