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Can an employer restrict your actions when you leave the company?

On Behalf of | Mar 24, 2022 | Employment Law |

Working in California affords you more workplace rights than you would have in much of the rest of the country. Compared to the rest of the United States, California has relatively thorough employee protections. There are numerous state laws that expand on existing federal regulations, as well as court precedent that protects those embroiled in a conflict with a former employer.

Employment contracts are one of the areas of employment law that are different in California. Many of the most problematic inclusions in an employment contract will benefit the employer at the expense of the worker’s future opportunities. Sometimes, workers move on to better jobs, only to face accusations and possibly contract litigation from their former employer.

Few things cause clashes between companies and the workers they employ as readily as restrictive covenants that apply after someone leaves the company. Do you need to worry about a restrictive covenant in your employment contract?

There are many kinds of restrictive covenants

Noncompete agreements prevent someone from starting a competing company or working for a competing business. Non-solicitation agreements prevent someone from reaching out to their professional contacts obtained at a job. Non-disclosure agreements prevent them from sharing any private company information while employed and after they leave the company.

You may have signed these contracts with little concern during your onboarding process, but now you worry that you can’t support yourself after leaving. Can your former employer enforce those contractual agreements against you?

California limits the rights of former employers

Non-compete agreements are essentially unenforceable in California. Although companies still include them in their contract, if they try to take the former worker to court, they will almost certainly lose their case. The same is true for non-solicitation agreements.

However, non-disclosure agreements are often enforceable. Violating the terms of a non-disclosure agreement could lead to civil proceedings and either a court order restricting your use or sharing of that information. In some cases, you can face a judgment that requires that you pay compensation to your former employer.

Before you sign the employment contract, looking at restricted terms and other clauses carefully can protect you. You might take a different job offer instead or engage in negotiations to eliminate those unfavorable terms. Understanding the unique California approach to employment law can help you make the most of your future after leaving a job.