Compete away, whether you live in California or not

California may have just made it a lot easier for employees to overthrow their noncompete agreements, but the good news is that even if you live outside the Golden State, these clauses are difficult to enforce.

California just made it easier for your career path to look like this.
California, a state notorious for having a dismissive attitude towards employee noncompete agreements, went one step further last Thursday in a unanimous state Supreme Court decision (ruling PDF), ruling that all worker noncompete clauses would now be null and void.

This ruling is no small triumph for workers in the Golden State, whose rights to move from one company to another, to work for a competitor or start their own business in the same specialization are now further entrenched.

Though the case was actually brought to court by a CPA formerly of Arthur Anderson, it may be an even bigger triumph for technology workers, many of whom bear the brunt of the limitations of noncompete agreements. Such a clause could theoretically prohibit a Microsoft software engineer from leveraging their expertise at Google or Yahoo due to a few lines in their contract that businesses say they need to protect their trade secrets but have been called by employee advocates everything from "a forced career-limiting move" to "vehemently anti-worker."

In fact, some analysts argue that California's already-lax approach to enforcing noncompete agreements--resulting in the free movement of technically inclined professionals from one start-up to another--was central to supporting the innovation that has made Silicon Valley tech epicenter it is today.

However, just because you don't live in competition-embracing California doesn't mean that if you've signed a noncompete agreement that you fear might limit your next career move you're out of luck. Most employment lawyers will tell you that even the most clearly-written non-compete is difficult to enforce in a court of law.

To enforce one, companies "have to show it's necessary to protect some legitimate business interest, such as trade secrets," David Barmak, a lawyer with Sherman Meehan Curtin & Ain, with headquarters in Washington, D.C. told can only be applied to what companies can legally protect, something difficult to define by even the savviest lawyer.

Furthermore, no matter how tightly worded an agreement is, it may not hold up in court if it limits the ability of a worker to make a living.

"If the employer's restriction against competition prevents you from working anywhere for anyone, it is probably too broad," explains attorney Neil Klingshirn at "Few employers will be able to convince a court that their business interest is important enough to prevent an employee from working for anyone else."

How about you? Have you ever signed a noncompete you wish you hadn't, or felt pressured into doing so in order to land a job you wanted?


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