Florida's non-compete statute is more employer-friendly than the comparable laws in most other states. In fact, the law is so employer-friendly that companies outside of the state will frequently choose Florida law to govern their employment agreements. In declining to enforce one of these "choice of law" provisions, an out-of-state court recently wrote that Florida's non-compete law was "offensive" to the state's policy of limiting non-compete enforcement in order to protect individuals' employability.
So, you are a Florida employer, and you have an employment contract in place that includes a non-compete clause. Should you use it?
Enforceability Requirements for Florida Non-Competes
While Florida's non-compete law favors enforceability, there are still limits as to the restrictions employers can impose on their employees. The law states:
"Enforcement of contracts that restrict or prohibit competition . . . [and] are reasonable in time, area, and line of business, is not prohibited. . . . The person seeking enforcement of a restrictive covenant [must also] prove the existence of one or more legitimate business interests justifying the restrictive covenant."
As a result, there are four preliminary questions that need to be answered when assessing the enforceability of a non-competition clause under Florida law:
- Is the duration of the non-compete reasonable?
- Is the geographic scope of the non-compete reasonable?
- Is the non-compete limited to the relevant line(s) of business?
- Does the employer have a "legitimate business interest" for imposing competitive restrictions on the employee?
If the answer to each of these questions is "Yes," and if the covenant is reasonably necessary to protect the employer's legitimate business interest, then the covenant should be enforced. In fact, under Florida law, once an employer establishes a prima facie case for the necessity of the competitive restriction (i.e. the employer pleads all of the necessary elements for enforceability), then the burden shifts to the employee to prove that the covenant is too long in duration, overbroad or otherwise unenforceable.
While the Florida courts have established certain general principles regarding the assessment of non-compete clauses (i.e. clauses with a duration over two years will generally be subject to greater scrutiny), each circumstance is unique, and each employer has the opportunity to present its case for enforceability in court. If carefully drafted with an eye toward satisfying the law's requirements, a non-compete will generally be enforceable under Florida law.
Practical Considerations for Non-Compete Enforcement
Of course, setting aside the strictly-legal considerations, there are certain practical considerations involved in taking a non-compete to court. Do you want to devote the necessary time and resources to litigate? Will it harm your company's public image or ability to attract talent if it public record that you have sued a former employee? Oftentimes, alternatives will be available, and understanding why an employee violated a non-compete (was it intentional or inadvertent) and reminding the employee of his or her contractual obligations can pave the way for a non-litigious, non-public resolution.
Contact the Fort Lauderdale Law Offices of Michael L. Feinstein, P.A.
Michael L. Feinstein, P.A. is a trial litigation law firm that represents businesses in non-compete and other contract disputes. If you would like to discuss taking action to enforce a non-compete with an attorney at our offices in Fort Lauderdale, please call (954) 767-9662 or contact us online today.