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If you're an employer or employee in the Golden State, you've likely heard whispers – or perhaps loud debates – about the non-solicitation agreement in California.
It's a topic that's often misunderstood, and for good reason. California has a unique stance on these agreements, one that champions employee freedom and mobility. So, let's pull back the curtain and really understand what these agreements mean, especially within California's protective legal embrace.
We're here to guide you through the complexities, making sense of the jargon and helping you understand your rights and obligations. For expert guidance in employment law, consider reaching out to legal professionals at MJB Law Group.
At its heart, it’s a promise. An employee typically agrees not to:
It's an agreement to leave certain company relationships unrouched post-employment.
Employers use them to protect their customer base, workforce stability, and sometimes, by extension, trade secrets. Legally, they represent a balance between protecting business interests and an individual's right to work, with California strongly favoring the latter.
California champions employee mobility and open competition. Section 16600 generally renders such restrictive covenants void, fostering an environment where talent can move more freely. This makes any discussion of a non-solicitation agreement in California particularly charged.
It’s easy to confuse non-solicitation clauses with other restrictive covenants. Let's clarify.
| Feature | Non-Compete | Non-Solicitation |
| Scope | Broad (prevents competition) | Narrow (prevents soliciting specific parties) |
| CA Status | Generally void (Bus. & Prof. Code §16600) | Generally void, with very limited exceptions |
NDAs protect confidential information and trade secrets (e.g., secret formulas, sensitive client data). These are generally enforceable in California if they protect legitimate trade secrets. An NDA says, "Don't share our secrets," while a non-solicitation says, "Don't use those relationships (or sometimes, even try to build them if they were ours)."
Confusion arises because these terms can appear together. An overly broad non-solicitation might try to achieve a non-compete's effect. Sometimes, an employer might hope the mere presence of these clauses deters employees, irrespective of their legal standing.
The big question: Are they enforceable? In California, the answer is usually "no." Business and Professions Code § 16600 is the key, voiding contracts that restrain lawful professions. Courts broadly interpret this to protect employee freedom.
Clauses usually target employees or clients.
These aim to stop ex-employees from poaching former colleagues. California courts have become increasingly skeptical, viewing these too as often violating Section 16600 (as seen in AMN Healthcare, Inc. v. Aya Healthcare Services, Inc.).
These try to prevent ex-employees from soliciting former clients. Generally unenforceable in California if they restrict an employee from practicing their profession, unless tied to genuine trade secret misappropriation.
Vague, overly broad, or hybrid clauses attempting to cover all bases are almost certainly unenforceable in California due to their overreach.
Despite general unenforceability, a few statutory exceptions exist.
(Business and Professions Code §§ 16601, 16602, 16602.5) When selling a business's goodwill or substantial ownership, the seller can agree not to compete or solicit within a defined area and time. This protects the value of what the buyer purchased.
This isn't an exception to §16600 for non-solicits themselves, but a separate protection. If an ex-employee steals and uses trade secrets (like a truly confidential client list) to solicit, the employer can sue under the Uniform Trade Secrets Act (UTSA). The action is for trade secret theft, not violating a (likely void) non-solicitation clause.
Even within the sale of business exception, restrictions must be reasonable in duration, geography, and scope of activity.
California courts are generally skeptical.
Employers must show a protectable interest, like actual trade secrets. Simply wanting to avoid competition isn't enough.
If a clause is potentially valid (e.g., sale of business), its length and breadth are scrutinized. Overly long or broad restrictions will be struck down.
California’s strong public policy favoring employee mobility and competition is paramount and usually overrides attempts to enforce non-solicitation clauses.
Given California's stance, extreme caution is needed if drafting such clauses (e.g., in a business sale).
Broad terms like "any client," "divert," or restrictions regardless of who initiated contact are problematic.
Clauses narrowly tied to specific trade secret misuse or fitting squarely within the sale-of-business statutory exceptions have a better (though still limited) chance.
Always consult an attorney familiar with California employment law before implementing or signing such agreements. The nuances are too complex.
How can California employers protect interests lawfully?
Don't use overly broad or aggressive clauses. They're unenforceable and can damage morale.
Rely on strong NDAs and robust trade secret protection policies.
Educate employees on handling confidential information properly.
Knowledge is power for employees.
Generally, you can work for competitors and solicit clients in California, as long as you don't use trade secrets. Announcing your new role is usually fine.
Don't take confidential data. Rely on public information or your own memory. If clients contact you first, document it.
Remember, many are unenforceable in California. Consider negotiating or consult an attorney before signing.
The tech sector feels these laws acutely.
California law facilitates talent mobility, which many believe fuels Silicon Valley's innovation.
Despite unenforceability, some companies still sue, creating uncertainty, especially if trade secrets are alleged to be involved.
VCs often prefer companies to protect themselves through innovation and strong IP, not unenforceable employment restrictions.
Employers risk lawsuits and counterclaims.
Trying to enforce a void clause can lead to dismissal of the case and potentially paying the employee's legal fees.
Employees might sue for unfair business practices or wrongful termination if fired for refusing to sign an unlawful clause.
Contracts or statutes might allow the prevailing party to recover attorney fees.
Understand exactly what it prohibits.
Crucial for assessing enforceability and strategizing.
Options include ignoring (risky), negotiating a release, or seeking a court declaration of invalidity.
If non-solicits are out, what's in?
Protect actual trade secrets and confidential data with well-drafted Non-Disclosure Agreements.
California's Uniform Trade Secrets Act (UTSA) offers robust protection for genuine trade secrets.
A positive work environment and fair treatment are often the best retention tools.
Disputes over a non-solicitation agreement in California can escalate. If an employer pressures an employee over an unlawful clause, leading to a hostile environment, terminates them for refusing to sign an agreement, or for lawful post-employment plans, this could lead to claims for wrongful termination or retaliation. California protects employees exercising their rights.
If a rare, valid non-solicitation is breached (e.g., in a business sale or involving trade secret theft):
Cease and desist letters, seeking injunctions, suing for damages.
Challenge validity, prove no actual solicitation or no trade secret misuse.
Court orders to stop, monetary damages, and potentially attorney's fees.
Don't navigate this alone.
Broad clauses, vague terms, or out-of-state law provisions warrant legal review.
Accusations or legal threats? Call an attorney immediately at MJB Law Group.
The best defense is a good offense. Have MJB Law Group review agreements before you sign.
If you’re dealing with a non-solicitation issue—whether you're an employee being pressured or an employer trying to protect your business—MJB Law Group can help. Located at 1442 Irvine Blvd Suite 201, Tustin, CA 92780, United States, we specialize in employment law across California and offer strategic, results-driven legal guidance.
Our team can review contracts, assess enforceability, and protect your rights every step of the way. We’re available Monday through Friday, from 8:30 AM to 5:30 PM, making it easy to reach out when you need legal support.
Need clarity on your contract? Contact MJB Law Group for a free consultation today.
The landscape of non-solicitation agreements in California are defined by the state's strong commitment to employee mobility. Most such agreements are unenforceable, with narrow exceptions for business sales or true trade secret misappropriation.
Employers should focus on lawful protections like NDAs and fostering loyalty. Employees should understand their broad rights to pursue their careers.
When questions or disputes arise, consulting experienced California employment attorneys, like the team at MJB Law Group, is your wisest move.
Generally, no, not without "new consideration" (like a raise or promotion). Continued employment alone usually isn't enough for a new restrictive covenant in California.
It's complex, but California law focuses on active solicitation by the ex-employee. If a client independently contacts you, and no trade secrets are used, it's a much weaker claim for the employer, especially since the clause itself is likely void.
Yes. California Business and Professions Code § 16600 applies to "anyone," including independent contractors. Restraining them faces the same high hurdles.
Yes, you can be sued. Winning is another story. If the clause is void, the suit should fail, but litigation is still stressful and costly. The risk increases if trade secret theft is also alleged.
