California employers don’t have many options for preventing employees from competing once they move on to another employer. For example, noncompete agreements are illegal here.
California courts also look askance at other attempts to restrain competition and prevent former employees from practicing their professions even if such restrictions are temporary.
Recent case: Deana Dowell and several other former employees of Biosense Webster had signed agreements that said if they went to work for a competitor, they couldn’t solicit Biosense’s clients for 18 months.
Then they indeed went to work for a competitor, which sued on their behalf to remove the restrictions.
The Court of Appeal of California sided with the former employees, concluding the agreements were too broad and weren’t designed strictly to protect trade secrets. (Dowell, et al., v. Biosense, et al., No. B201439, Court of Appeal of California, 2nd Appellate Division, 2009)
Final note: Don’t even think of drafting your own trade-secret agreement. Get an attorney’s help. That is especially true if you are a multistate employer and use a common agreement in all locations where you work. What may be perfectly legal in other states may be illegal in California. (In fact, in the case above, the agreement the employees signed said New Jersey law applied. That, however, wasn’t the way California courts saw things.)
- How to Fire an Employee the Legal Way: 6 Termination Guidelines
- 'Offering' chance to quit may still be constructive discharge
- High court says Labor Dept. right to limit overtime for some
- EEOC drives a stake into heart of age-Based retirement policies
- 1st Amendment free-speech rights extend to government contractors, too