New California laws intended to strengthen the state’s long-standing ban on non-competition agreements are set to create immediate headaches for employers in the state that have, or plan to, impose non-compete or non-solicit clauses on their employees in the Golden State. The new amendments — S.B. 699 and A.B. 1076 — not only codify existing case law banning nearly all non-compete agreements, but go a step further by empowering employees to sue their employer for imposing or trying to enforce a non-compete against them, even if the non-compete was entered in another state where it would have otherwise been enforceable. An employee who wins such a case can also recover reasonable attorneys’ fees and costs. The law became effective January 1, 2024.

These amendments also require employers to provide individualized, written notice to current and former employees (who were employed at any time after January 1, 2022, and have signed agreements containing non-compete clauses) by February 14, 2024, that any prior non-compete covenants or non-solicitation covenants violating the law are void. The notice must be delivered to the last known address and the email address of the employee or former employee. An employer who fails to comply may be subject to a penalty of $2,500 per violation.

General Prohibition on Non-Competes and Restrictive Covenants

California has long prohibited employers from entering agreements to prevent their employees from leaving to compete against them. Even...

Read Full Story: https://news.google.com/rss/articles/CBMiSWh0dHBzOi8vd3d3Lmpkc3VwcmEuY29tL2xl...