Non-Competition Agreements in in Orlando, FL
Employers should always consider the terms that can affect their business when drafting and presenting their employees with non-compete agreements. The state of Florida has statutory language that addresses requirements employers should review, with an attorney, prior to presenting an employee with a non-compete agreement. Employers can expose their business to costly claims and lengthy litigation when statutory and case law is not carefully considered. ;Once a non-compete agreement is executed by both parties, employers may need to address more complex questions.
One of the important components in a non-compete agreement is whether an employer actually has a legitimate business interest. Employers must justify having a non-compete clause in an agreement. Florida law states that a court will not enforce a non-compete agreement unless it is in writing and is signed by the employee. The employer also must establish one or more legitimate business interests. Business interest may include trade secrets, other business information that does not come under the category of trade secrets, substantial relationships related to the business, goodwill, geographic location, marketing or trade areas and training. Agreements not supported by a legitimate business interest are considered void and unenforceable under Florida Statute 542.335.
Employers attempting to enforce a restriction on an employee will have to prove that the agreement is reasonably necessary to protect a business interest or business interests. Employees who challenge such restrictions in non-compete agreements must prove the restrictions are overbroad, overlong or otherwise unreasonably restrictive in the businesses effort to protect an established business interest or interests. Under the same statute, Florida courts can modify the restriction if it is determined a restriction is overbroad, overlong or otherwise not reasonably necessary to protect the business interest or interests.
Courts apply arguable presumptions when employers attempt to enforce restrictive covenants against former employees, agents or independent contractors.
Reasonableness under the Florida statute, not subject to trade secrets a court shall apply the following rebuttable presumptions:
1. In the case of a restrictive covenant sought to be enforced against a former employee, agent, or independent contractor, and not associated with the sale of all or a part of:
A. The assets of a business or professional practice, or
B. The shares of a corporation, or
C. A partnership interest, or
D. A limited liability company membership, or
E. An equity interest, of any other type, in a business or professional practice,
A court shall presume reasonable in time any restraint 6 months or less in duration and shall presume unreasonable in time any restraint more than 2 years in duration.
Employers should consult an attorney to determine if a claim for a material breach of a non-compete agreement is valid based upon case law. Depending upon the set of facts, Florida case law has established circumstances in which employers may have breached the non-compete agreement with their employee. These cases illustrate some of the roadblocks employers may face when trying to enforce non-compete agreements.
In Benemerito & Flores, M.D.s, P.A. v. Roche, 751 So. 2d 91 (4th DCA 1999), the employer was found to have materially breached the agreement by reducing the bonus the employee was entitled to under the terms of the contract.
In Bradley v. Health Coalition, Inc., 687 So. 2d 329 (3d DCA 1997), an employee claimed he was forced to resign after he was asked to engage in improper business practices. The employer claimed it was a voluntary resignation and attempted to enforce the non-compete agreement. The employee claimed, among other things, that after his employment ended, the employer wrongfully refused to pay certain commissions, which he had earned. The court determined that when an employer wrongly refuses to pay an employee, the employee is no longer required to fulfill any other contract obligation and the employer cannot obtain an injunction.
In case of Troup v. Heacock, 367 So. 2d 691 (Fla. 1st DCA 1979), an insurance agent was an at will contract with a weekly draw of $125. The employer unilaterally reduced the draw twice. The court determined that the reduction was a material breach which then relieved the agent of any of his obligations under the non-compete agreement. The employer was denied its motion for permanent injunctive relief.
The most common reason for a Florida court to refuse injunctive relief to an employer occurs when employers material breach an employment contract by failing to compensate an employee who has signed a non-compete agreement.
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Attorney Frank Malatesta is extremely skilled & knowledgeable in his area of law. He takes the time to respond promptly. His staff is very efficient and professional. Attorney Frank is very direct and forthright in his communications. You will feel heard, understood and valued as a client. I am very pleased with the outcome of my matter. Thank you for exceeding my expectations!
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