Does California allow non-compete agreements?

Most states allow employers to ask their employees to sign non-compete agreements. In some states, employers are even allowed to fire employees who refuse to sign. This means that many employees feel they have no choice but to sign the paperwork, even when it restricts their ability to work somewhere else.

Say you’ve lived most of your life in Florida, which has non-compete laws that generally favor businesses, in the sense that these agreements are enforceable and employees have been fired for refusing to sign. But you’ve recently moved to California and taken a new job. Can your employer ask you to sign a non-compete, and do you have to agree if they ask?

California is an exception to the rule

Though it is true that most states allow non-compete agreements, perhaps the biggest exceptions are in Texas and — of course — California. California has declared that these types of agreements are void contracts. In other words, your employer can tell you to sign one, but if you violate it and they try to take you to court, the court is not going to uphold that contract. You’re not actually bound by anything. This is done to make it easier for employees to switch between jobs, which helps to keep the marketplace competitive.

These differences between state laws show why workers who move across the country need to make sure that they’re well aware of the laws in the state they now inhabit. This could be very different than they’re used to. If you feel that your employer has violated your rights under these laws, then you also need to know what legal options you have. 

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