What is a California Noncompete Agreement?

Los Angeles Employment Attorney Explains When Non-Compete Agreements May Not Be Legal

A no-competition, no compete or noncompete agreement is part of an employment contract that many businesses require their employees to sign either before they are hired or before they leave the company. By signing the document, you are agreeing not to use what you learn or learned on the job to join or start a new company that competes in the same market as your original employers.

In many states, noncompete agreements are entirely legal, which means that companies can bring a legal case against any employee who breaks one. However, California is a notable exception to this rule. There are only a few special circumstances in which a California noncompete agreement is legal.

Our law firm has gained national recognition and reputation for success in employment law cases. If you have questions about a California noncompete agreement, an employment attorney from the Law Offices of Kesluk, Silverstein & Jacob can help with a free initial consultation.

When is a California Noncompete Agreement Legal?

In California, legal noncompete agreements typically only apply to business owners who wish to sell their companies. These owners are prevented from starting new companies or stealing former clients from the previous business. These contracts may include arbitration clauses, which state that any breach of the agreement must be settled in court.

For employees wishing to move from one company to another within the same industry, noncompete agreements in your employment contract cannot stop you from leaving your old company or being hired at a new one. However, there are California employment laws in place to prevent you from using confidential information or trade secrets after you leave a job. If you sign an agreement not to use your employer’s trade secrets to compete in the same business market, that contract is probably enforceable by law.

What Should I Do If I Signed a Noncompete Agreement?

Noncompete agreements are usually unenforceable in California, but many companies try to find ways around these state laws. If a company has locations nationwide, for example, they may try to enforce non-compete agreements from a completely different state. Some companies will also try to include specific locations in their non-compete agreements, which attempt to prevent former employees from joining or starting companies within limited locations.

If you have signed or been asked to sign a California noncompete agreement, a Los Angeles employment attorney from the Law Offices of Kesluk, Silverstein & Jacob can help. We can look over any contract and tell you if it is legal under California state law. Contact us online or call (310) 273-3180 for a free claim review.