Legal Question in Business Law in California

Non-Compete Clause

My husband has worked in the same industry for 12 years, and he has worked for his current employer for the past 4 yrs. A year ago, his co. was purchased by a much larger corp. They have offered him a ''promotion'' which requires us to relocate from OH to CA. He has verbally accepted the offer. Now, 2 wks later, the HR dept of the new co. presented his relocation pkg to him that also includes a non-compete clause which states he cannot work for ANY co. in his industry for a 1 yr period after he leaves the co. They did not specify a geographic area, rather gave a very comprehensive list of the companies he could not seek employment with. And, the agreement says that it will be governed by the laws of Virginia even though we will be living in CA. Is it even legal (and/or ethical) for his co. to expect him to ''roll over'' and sign this thing...no compensation has been offered, and if he leaves the co. & they enforce it, he will not have any means of making a living for a year!


Asked on 3/28/01, 3:52 pm

2 Answers from Attorneys
Michael Cortson Law Office of Michael D. Cortson, Esq.

Re: Non-Compete Clause

In California these clauses are void. See,

BUSINESS AND PROFESSIONS CODE SECTION 16600-16607

16600. Except as provided in this chapter, every contract by which

anyone is restrained from engaging in a lawful profession, trade, or

business of any kind is to that extent void.

Read more
Answered on 6/01/01, 1:12 pm
Bryan Whipple Bryan R. R. Whipple, Attorney at Law

Re: Non-Compete Clause

I have not read the exact language of the proposed contract, but any provisions that prevent someone from practicing his trade or occupation are void and uneforceable. Some employers include them anyway in an apparent attempt to intimidate employees into loyalty, and it sometimes works, which is why employers continue to do it. This is irritating the courts, and judges are increasingly inclined to rule very favorably toward employees so treated.

In sharp contrast, California law is protective of "trade secrets," and an employee going to work for a competitor must be scrupulous about not taking any intellectual property, files, customer lists, etc. or using any proprietary information to benefit the new employer to the detriment of the former employer.

Read more
Answered on 6/01/01, 4:21 pm


Related Questions & Answers

More Business Law questions and answers in California