Non-compete agreements are signed when the relationship between the employer and the worker begins. They give the employer control over certain acts of the former employee, even after the relationship has ended. 2. Do I have to accept a non-compete agreement? 9. Does my employer have to pay me extra money in exchange for a non-compete agreement? One of the major court decisions that discuss the conflict between California law and the laws of other states is Application Group, Inc. v. Hunter Group, Inc. of 1998 In Hunter, a Maryland company required its Maryland-based employee to accept a one-year non-compete agreement. The contract stipulated that it must be regulated and interpreted in accordance with Maryland law. A Maryland employee then went to work for a competitor in California.
When the new California employer sued in the California State Court to have the Confederacy invalidated from not competing, the California court agreed and ruled that the California non-compete clause was invalid and unenforceable. Section 16600 of the Business and Professions Act reflects a “strong public policy of the State of California” and the state has a strong interest in enforcing its law and protecting its businesses so that they can hire employees of their choice. California law therefore applies to non-California workers looking for work in California. [Citation required] Most contracts set a certain period of time during which the worker is excluded from working with a competitor after the end of his or her employment with the employer. An employer who wishes a non-compete agreement may, in some cases, pay a “consideration”: additional compensation in exchange for the worker or seller who accepts this provision or another non-monetary benefit, such as. B a change in obligations or those responsible for the work. However, the need to do so depends on your state`s law. As a general rule, your employer does not have to give you additional financial compensation, but this cannot have any consequences if the employer tries to enforce the agreement. Some states require the payment of counterparties, while others consider it simply an important part of the court review to decide the application of the agreement.
In addition, the employer may demand any actual damages or losses they claim to have occurred because the worker in violation of the agreement not to compete – this could include customer loss of earnings, loss of secret employer information and similar losses.