Companies with California employees who are subject to non-competes have a fast-approaching deadline of February 14, 2024, to notify those individuals that these agreements are void or risk legal liability under a new California law. While California has long been hostile to non-compete agreements and other restrictive covenants, the legislature passed an amendment to Section 16600 of the Business and Professions Code mandating California employers send written notice to current and certain former employees that their non-compete clauses or agreements are void. Penalties for non-compliance could be severe.
To comply, employers must notify all current and former employees who were employed after January 1, 2022, and subject to a non-compete under California law, that their non-compete is void in California. The written notification must also:
- Be individualized to the current or former employee in question; and
- Delivered in hard copy to the person’s last known address and sent by email by no later than February 14, 2024.
Failure to notify the current or former employee constitutes a per se act of unfair competition under the state’s Unfair Competition Law, and violators are subject to civil penalties, injunctions, restitution, and enforcement actions brought by the state.
Employers with current and former California employees, or employees subject to California-governed non-competition, non-solicitation agreements, and other restrictive covenants should review those agreements immediately in light of the upcoming deadline. Attorneys in PilieroMazza’s Labor & Employment Group are available to help determine whether any current or former employee should receive notice under the new law and assist with drafting compliant notices. If you have any questions or need assistance, please contact Nichole Atallah, Zachary Stinson, or another member of the Firm’s Labor & Employment Group.
Looking for practical insights on gaining a competitive advantage through a deeper understanding of the government’s compliance requirements? Check out PilieroMazza’s podcasts “GovCon Live!” and “Clocking in with PilieroMazza.”