Upcoming Deadline to Notify California Employees Subject to Non-Competes
Wednesday, February 7, 2024

As we reported last month, effective January 1, 2024, non-compete agreements in California are unenforceable regardless of where the contract is signed. This means employees who sign non-competes outside California, then move to California and seek new employment in violation of the non-compete, can rely on California law to invalidate the non-compete. Practically speaking, this creates unpredictable challenges for employers with mobile or largely remote workforces.

More importantly, AB 1076 makes it unlawful for employers to include a non-compete clause in an employment contract or require an employee to enter a non-compete. Any employer who uses, or attempts to use, a non-compete with employees working in California now can be sued by those employees, and the law entitles the employee to an injunction, damages, and attorneys’ fees in the lawsuit. In addition, by February 14 – next week – employers must provide notice to any current or former employee employed after January 1, 2022, that their non-compete clause or non-compete agreement is void. This notice must be individualized and in writing sent to the employee’s last known mailing and email address. Employers who fail to provide the required notice on time may be assessed a civil penalty of up to $2,500 per violation.

 

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