Non-compete agreements, also known as covenants not to compete, can be important to prevent another company or employee from misappropriating your clients or business. While these contracts can provide necessary protections, the law governing non-compete agreements in California is highly complex. To ensure your agreement is enforceable, you should always have a skilled business attorney at Randick O’Dea & Tooliatos, LLP, draft and negotiate the contract.
Non-Compete Limitations in California
When you hire a new employee or begin doing business with a new company or client, it is only natural to want to protect your own client base from misappropriation. Many states allow non-compete agreements in a wide range of contexts, however, California has some of the most restrictive laws in the United States regarding this type of agreement.
California law prevents any agreement that restricts a person’s right to engage in a lawful profession or business. This means that you cannot keep an employee from going to work for a competitor or prevent someone from soliciting your clients. Such contracts are generally unenforceable in our state. However, you can use agreements to limit the exposure of trade secrets or confidential information about your business.
On the other hand, non-compete agreements can be used if you are purchasing a business. This covenant not to compete is essential to prevent the seller from then competing with your newly-acquired company. This is often a non-negotiable aspect of any business merger or acquisition, and you want to ensure your non-compete agreement is thorough and enforceable.
Consult with Our Pleasanton Business Lawyers
At Randick O’Dea & Tooliatos, LLP, our attorneys fully understand California business laws and assist companies of all types around the Pleasanton area. Please call 925.460.3700 or contact us online if you would like to discuss a business transaction or contract negotiation.