The law regarding the enforceability of non-compete agreements varies by state. Under Florida law, three requirements must be satisfied for a restrictive covenant to be enforceable: (1) the restrictive covenant must be “set forth in writing signed by the person against whom enforcement is sought”; (2) the party seeking to enforce the restrictive covenant “shall plead and prove the existence of one or more legitimate business interests justifying the restrictive covenant”’ and (3) the party seeking to enforce the restrictive covenant “shall plead and prove that the contractually specified restraint necessary to protect the legitimate business interest or interests justifying the restriction.” § 542.335, Fla. Stat. Peter Mavrick is a Fort Lauderdale non-compete attorney, and represents clients in non-compete litigation in Miami, Boca Raton, and Palm Beach. The Mavrick Law Firm also represents clients in business litigation (including breach of contract litigation and related claims of fraud), trade secret litigation, trademark infringement litigation, employment litigation, and other legal disputes in federal and state courts and in arbitration.
Florida courts will enforce non-compete covenants only where they are reasonable. Quirch Foods LLC v. Broce, 314 So. 3d 327 (Fla. 3d DCA 2020). The covenant must be “reasonable in time, area, and line of business . . . ” § 542.335, Fla. Stat. “Thus a prerequisite for enforceability is that the covenant appear on its face to be reasonable.” Silvers v. Dis-Com Securities, Inc., 403 So. 2d 1133 (Fla. 4th DCA 1981). “This is part and parcel of plaintiff’s cause of action so that the court may address the issue of reasonableness in time and area whether or not the defendant raises the question in his pleadings.” Silvers v. Dis-Com Securities, Inc., 403 So. 2d 1133 (Fla. 4th DCA 1981). “On the other hand if the covenant appears on its face to be reasonable then the burden shifts to the defendant to plead and prove that it is for some reason not reasonable on the facts of the particular case.” Silvers v. Dis-Com Securities, Inc., 403 So. 2d 1133 (Fla. 4th DCA 1981).
Employee agreements containing non-compete covenants, however, may contain a choice-of-law provision of another state. Florida courts will generally apply the law of another state when analyzing the reasonableness of a non-compete covenant where the employment agreement containing the non-compete covenant contains a choice of law provision of another state. Mazzoni Farms Inc. v. E.I. DuPont De Nemours & Co., 761 So. 2d 306 (Fla. 2000) (holding that contractual choice-of-law provisions are presumptively valid and enforceable in Florida unless the law of the chosen forum contravenes strong public policy). Thus, if an employee lives in Florida but works remotely in another state, Florida law will not automatically apply. Rather, Florida courts will look to the law of the state governing the employment agreement to determine whether a non-compete clause is enforceable. Additionally, Florida companies may have to enforce their non-compete agreements for remote employees in the state where the employee lives. Not every state follows Florida’s strong public policy of enforcing reasonably written non-compete clauses, and not every state provides the same level of protection to companies that the law in Florida provides.
For example, in Onward Search LLC v. Noble, 2022 WL 2669520 (D. Conn. July 11, 2022), the United States District Court for the District of Connecticut addressed the enforceability of a non-compete covenant contained in an employment agreement that prevented the defendant from competing with its employer “within a radium of sixty (60) miles from any such office[.]” In arguing in favor of the covenant’s enforceability, the plaintiff asserted that one of its “office[s]” included the defendant’s remote home office. Onward Search LLC v. Noble, 2022 WL 2669520 (D. Conn. July 11, 2022). The court disagreed with the plaintiff, ruling that “[s]uch an expansive interpretation of the non-compete clause is unlikely to be enforceable.” Onward Search LLC v. Noble, 2022 WL 2669520 (D. Conn. July 11, 2022). The court reasoned in part that “[a] restrictive covenant which protects the employer in areas in which he does not do business or is unlikely to do business is unreasonable with respect to area.” Onward Search LLC v. Noble, 2022 WL 2669520 (D. Conn. July 11, 2022). The court further reasoned that such an interpretation “would unduly restrain [the defendant’s] ability to pursue his livelihood.” Onward Search LLC v. Noble, 2022 WL 2669520 (D. Conn. July 11, 2022).
Peter Mavrick is a Fort Lauderdale non-compete lawyer, and represents clients in Miami, Boca Raton, and Palm Beach. This article does not serve as a substitute for legal advice tailored to a particular situation.