Usually, a covenant not to compete is when a California employee agrees not to work for an employer's competitors when the employee leaves the company. Covenants not to compete are also known as "non-compete clauses". An employee who signs them either does so as a condition to employment or they may receive compensation for the agreement.

When are Covenants not to Compete Unenforceable?

It is difficult to discern whether a judge will enforce a given non-compete agreement. Even though the interests of an employer are important, California courts value a person's freedom to select the type of employment that they desire. Thus, courts will typically uphold only those covenants not to compete that they conclude to be reasonable. Covenants not to compete that a court will categorize as unreasonable include provisions that last for a long duration or that restrict the employee to an unreasonable geographic area around San Mateo County.

Covenants not to compete are also required to deal only with competitors who are rationally related to the employer's line of industry. Finally, the covenant not to compete must have a legitimate business purpose which is behind the employer's motivation for requiring the agreement.

Do I Need an Attorney when Dealing with a Covenant not to Compete?

Since covenants could restrict your rights, you may wish to hire a San Mateo County, California lawyer to review any provisions. They will be able to negotiate further changes to the covenant, and can draft an entirely new one that is acceptable to all parties if needed. A lawyer can also render useful advice for employers who are considering suing an employee for breach of covenant, or they can counsel employees who have signed such an agreement.