Of course, the most conservative response from an employer would be to remove these provisions regarding worker non-solicitude from all agreements with California employees. If such a provision is not of particular importance to an employer, it may be helpful. However, a recent Delaware Chancery Court decision suggests that there could be a small loophole for non-California employers. While acknowledging that Section 16600 specifies that non-competition clauses under California law are null and for none, it found that Section 925 contains a fork in relation to the general rule that treaty provisions that attempt to avoid the problem by choosing to use another state`s law are unenforceable in California. In particular, the Delaware court found that the law contains a subsection stating that the rule prohibiting non-California law selection provisions is not applicable when the worker is represented by a lawyer when negotiating the terms of the contract. The court found that, since the worker was represented in the case by his personal lawyer during the employment contract negotiations, Delaware`s disposition of choice would be maintained in the agreement. The Court also held that the non-compete clauses would apply to the California worker, since Delaware law authorizes non-compete clauses. Of course, if the employee had won the court race and had first filed it in California, the result would probably have been different. There is a strong argument that, given that the NMA Court conducted this in-depth edwards analysis, the intention was to extend its decision to all workers` non-invitation agreements, rather than limiting them to the concrete facts of the case. Two federal courts in the Northern District of California have agreed. In other words, competition bans and non-acclicant agreements may be considered enforceable if certain criteria are met, i.e.
if these agreements are supported by an appropriate consideration (the initial or continuous offer of employment is considered appropriate in most legal systems) where they are necessary to protect a legitimate business interest (good will, confidential information and client lists are considered in most jurisdictions to be a legitimate business interest of the employer). , and if they are appropriate in the current circumstances (for example. B if they are limited in time, i.e. one to three years, and in space, i.e. when they are limited to certain areas or states within the United States, or where there are no specific geographic restrictions, when they are limited to clients with whom the former employee has established specific contacts and relationships during his or her employment). As a result of these two cases, California law is changing as to the future viability of the non-claim provisions of staff. During this period of uncertainty, employers should consult with Demcounsel to determine whether they should keep such provisions in their working papers in California. However, two recent cases in California have cast doubt on Loral`s viability and found these provisions unenforceable. Second, in a January 2019 notice in Barker v. Insight Global, LLC, a federal district court in the Northern District of California passed a provision limiting a regional director`s recruitment of staff or contractors during employment and was not applicable a year later. 2019 WL 176260 (N.D.
Cal. January 11, 2019). The court found that it was “convinced by the statement of NMA`s reasons that California law is properly interpreted according to Edwards in order to invalidate the non-solicitation clauses of employees.” In particular, the Tribunal rejected the employer`s attempt to limit amN to the specific obligations of workers at work. Are you being sued by a former employer for allegedly violating a non-invitation agreement? If so, they have the right website for all your labor law questions.