Many people sign non-compete agreements with their employers without understanding its precise terms. Don’t assume the document just limits you to working for a competitor in the same town or county, even when it says as much. Many non-compete agreements may claim to apply on a national or even worldwide scope, but not all of these agreements are enforceable as written.
Under Florida law, a non-compete agreement is enforceable “so long as such contracts are reasonable in time, area, and line of business.” What the law defines as “reasonable” will depend on the nature of the employer’s operations and its legitimate business interests.
A worldwide Non-Compete may not be “reasonable”
As Florida’s First District Court of Appeals put it in the decision, Orkin Exterminating Co., Inc. v. Girardeau, “what is a reasonable area is a factual matter to be determined in each case.” There may be situations where a statewide or even national non-compete could be held legal. But as with all non-compete agreements, the burden is on the employer – not the employee, to prove that a broader scope is necessary to protect its legitimate business interests.
Refer to the 2020 Florida Statutes links below:
REGULATION OF TRADE, COMMERCE, INVESTMENTS, AND SOLICITATIONS
COMBINATIONS RESTRICTING TRADE OR COMMERCE
542.335 Valid restraints of trade or commerce.—
Speak with an attorney before signing a non-compete agreement
Once again, however, it is important to understand that what qualifies as a “reasonable” scope or geographic area will depend heavily on the specific facts of each case. Take the previously mentioned Orkin Exterminating decision. There, the non-compete agreement only purported to cover several Florida counties in and around Jacksonville. The Court of Appeals still found that geographic area to be too broad in scope, largely because the employee himself had only ever worked for the employer in a single part of Jacksonville. The Court therefore defined “reasonable” as only that neighborhood.
No matter how your employer chooses to phrase its own non-compete agreements, you should not assume that will be legally enforceable. At the same time, never sign agreement without first taking the time to fully understand its stated scope and restrictions. If you require assistance, call Derek Usman, a qualified Florida employment law attorney at (813) 377-1197.