Calif. Court Finds Employees Can’t Be Forced to Sign Noncompetition Agreements

• Posted by Geoffrey G. Gussis on September 5th, 2006


• Filed in Employment Law

The Associated Press reports that California continues to make news in the area of employee rights - this time in the area of non-competition agreements:

"Companies operating in California cannot make employees sign contracts promising not to work for a competitor, a state appellate court ruled.

Wednesday’s decision in Raymond Edwards II v. Arthur Andersen LLP, No. B178246, rejects 20 years of federal case law that had held the non-competition agreements were legal if they were crafted narrowly enough that an employee who left a company still could work in his or her profession.

A federal appellate court "misapplied" California law on the issue, said the decision by the state’s 2nd District Court of Appeal.

"Noncompetition agreements burden a terminated employee with the task of guessing, at his or her peril, whether a court might find particular restrictions sufficiently narrow or overly broad," the ruling said."

Link: Calif. Court Finds Employees Can’t Be Forced to Sign Noncompetition Agreements.