Non-Compete Attorney in San Francisco

San Francisco is a booming economy for many, especially those who work in the technology sector. San Francisco workers should the right to work for different companies. That’s even truer in an era when many employees need change to become better at their jobs. Employees shouldn’t be forced to stay with one company when they can improve their lives and the lives of their families by moving to another company.

Yet, that doesn’t stop companies, big and small, from wanting their employees to sign non-compete clauses. Fortunately, California now has a law that voids any non-compete clauses. The law provides that people have the right to work in their chosen profession, trade, or business. Essentially, non-compete clauses in California employment contracts are void.

The law applies to all types of jobs – professional and non-professional.

The history behind non-compete contracts

Before the passage of California’s law invalidating non-compete and non-solicitation contracts, the general law was that non-compete clauses in employment contracts were valid if they weren’t prohibitive. This means that the contracts were valid provided the following restrictions applied:

  • The length of the non-compete clause. The prohibition against going to work for a competitor couldn’t be indefinite. Stopping a worker from competing for a year was generally permissible. Longer time-frames were generally invalid.
  • Geographical limits. Employers could only restrict employees from working where they were actually likely to compete with the employer. Prohibitions beyond a 25 or 50-mile radius were usually ruled invalid.

Many states still use these two tests to determine if a non-compete clause is legal. Again, in California, these non-compete laws are now invalid. The law is based on the understanding that most workers today will work for several companies or more during their lifetime. The days of working for one company for life are long gone.

The California prohibition applies even when an employer reasonably believes the employee will disclose trade secrets or intellectual property to a new employer. California requires that an actual illegal disclosure takes place before the employer can file a lawsuit.

The rights of employees when employers wrongfully fire them or refuse to hire the employee – due to non-compete contract clauses

Employees, with the help of legal counsel, have the right to:

  • File a wrongful termination lawsuit against an employer who fires an employee who refuses to sign a non-compete clause in an employment contract.
  • File a claim for bringing an invalid action – against an employer who seeks to enforce a non-compete clause
  • File an employment lawsuit against an employer who won’t hire an applicant because the applicant refuses to sign a non-compete clause

In San Francisco, the damages differ depending on the basis for the lawsuit. Damages in a wrongful termination case, for example, include:

  • Being ordered to rehire the employee
  • Lost income and lost benefits due to the firing
  • Attorney fees

Employees can also assert the California law as a defense to any enforcement action of the non-compete clause by the employer.

When non-compete clauses may be valid

There are a few areas where employers can enforce a non-compete provision or related provisions.

  • Generally, employers do have a right to protect their trade secrets and intellectual property. If they discover, for example, that an employee gave a customer list to a new employer, the prior employer could file a claim against the employee.
  • The California law on non-compete clauses does give the buyer of a business the right to enforce a non-compete clause against the seller of the business. This concept applies to sales of limited liability corporations and partnership interests as well. Still, the non-compete provision does have limits. The geographical fairness test will apply.

Techniques employers try to use to circle around the non-compete law

Employers will try to get around the non-compete provisions. Two ways they are currently trying to do this in the San Francisco region are:

  • Changing the notice period for terminating an employment contract from a few weeks to three to six months.
  • Trying to use contract provisions such as holding that the laws of the state where the employer has its main office should control instead of California law.

Employees in San Francisco should speak with experienced employee rights lawyers – if they are being pressured to sign a non-compete contract or if the employer is trying to enforce a non-compete contract. At the Los Angeles law offices of Stephen Danz & Associates, our lawyers fight to assert your rights. We hold employers accountable in court if they wrongfully terminate someone, wrongfully try to enforce a non-compete clause, or fail to hire someone if they won’t agree to a non-compete provision.

To learn your rights, call us at (877)789-9707 to schedule an appointment. Se Habla Espanol.