The enforceability of restrictive covenants, particularly non-compete agreements, can be very difficult for employers to navigate, especially for companies in their “start-up” phase. Technology companies in particular face challenges in structuring non-competes that balance their need to attract talent with their need to protect confidential and sensitive information, while preventing unfair competition by former employees. … Continue Reading
The Massachusetts Noncompetition Agreement Act, M.G.L. c. 149, § 24L, has been the law of the Commonwealth for almost four months. The statute only applies to agreements entered into between employers and certain employees and independent contractors on or after Oct. 1, 2018, so the law’s ramifications are still largely yet to be determined. Nevertheless, … Continue Reading
Many employers and attorneys assume that covenants not to compete found in employment agreements are not enforceable against California residents absent narrow exceptions, and that courts would reject any attempt to apply another state’s choice of law provision to draft around this issue. A recent case from the Delaware Chancery Court, NuVasive, Inc. v. Patrick Miles, … Continue Reading
The title should not be read to suggest some tectonic shift in the moods and values of the California Legislature or the Governor; far from it. However, every once in a while something a bit useful does emerge. This time it is some certainty in executive level employment contracts. AB 1241 adds yet another section … Continue Reading
As companies grow and expand into multiple U.S. states, particularly in our increasingly knowledge and relationship-based economy, determining the applicable law for companywide restrictive covenants can be puzzling. Determining which law applies can make the difference between enforcement or the inability to enforce the covenants. In Cardoni et al. v. Prosperity Bank (Case Nos. 14-20682 … Continue Reading
Drafting an effective employment agreement or release has become a challenging endeavor for a new reason. In Golden v. California Emergency Physicians Medical Group, the U.S. Court of Appeals for the Ninth Circuit added another source of concern to those employers who deploy “no re-hire” provisions in releases. Following Golden, a fact-intensive inquiry may be … Continue Reading
Prepared by: Brian Confino Most businesses possess confidential information or trade secrets that need to be safe-guarded, or intellectual property, equipment, or processes that set them apart from their competition. Many companies choose to protect this information using “restrictive covenants” – agreements in which employees promise not to compete with the business in the future, … Continue Reading
The National Labor Relations Board (“NLRB”) continued its recent trend of reviewing employment provisions often contained in employee handbooks or employment agreements. On December 3, 2012, the NLRB’s Division of Advice released an Advice Memorandum dated May 16, 2012 in which it reviewed a “moonlighting” provision and a non-compete provision in an employment agreement. The … Continue Reading
In California, it is well established that non-compete provisions are unenforceable, subject to certain statutory exceptions. But what about non-compete provisions that are ambiguous as to their protection of confidential information or trade secrets? Recently, when faced with such a provision, one California federal court narrowly construed the provision to find it enforceable.… Continue Reading
Does an employee have the right to proceed before the California Labor Commission after signing an agreement to arbitrate all claims? That is a question the California Supreme Court will have to decide after the U.S. Supreme Court vacated its decision in Sonic-Calabasas A, Inc. v. Moreno and remanded the case for further consideration in light of AT&T Mobility v. … Continue Reading
The Virginia Supreme Court issued an opinion on Friday making clear that non-compete provisions that are overbroad as to the function to be performed by the employee are not enforceable in Virginia.… Continue Reading
