State-Specific Non-Compete Laws: Non-compete laws vary significantly by state. California largely prohibits them, while states like Florida, Texas, and New York have specific requirements for enforceability. Must consider jurisdiction where agreement will be enforced.
FTC Proposed Rule: Federal Trade Commission's proposed rule to ban non-compete clauses (currently pending) must be monitored for potential impact on agreement enforceability.
Federal Antitrust Laws: Federal antitrust regulations that protect market competition and prevent unfair restraints of trade must be considered in agreement terms.
Fair Labor Standards Act: FLSA compliance regarding employee classification, compensation, and working conditions must be maintained in relation to restrictive covenants.
At-Will Employment Doctrine: Impact of at-will employment relationship on non-compete enforceability and termination provisions must be addressed.
Right to Work Laws: State-specific right to work laws may affect the scope and enforceability of employment restrictions.
National Labor Relations Act: NLRA requirements regarding collective bargaining rights and protected concerted activity must be respected.
Employee Classification Considerations: Different requirements and restrictions may apply based on whether workers are W2 employees or 1099 independent contractors.
Duration and Geographic Scope: Requirements for reasonable time limits and geographic restrictions that vary by jurisdiction and must be justified by business needs.
Legitimate Business Interests: Documentation and justification of legitimate business interests being protected by the non-compete provisions.
Consideration Requirements: Adequate consideration must be provided to employees in exchange for non-compete restrictions, varying by state law.
Customer Protection Provisions: Specific provisions regarding protection of customer relationships and client lists, including scope and duration of restrictions.
Confidentiality Requirements: Provisions protecting confidential information and trade secrets, aligned with state and federal trade secret laws.
Biden Executive Order: Executive Order on Promoting Competition in the American Economy's impact on non-compete enforcement and restrictions.
COVID-19 Related Changes: State-specific modifications to non-compete enforcement and requirements in response to the COVID-19 pandemic.
Recent Court Precedents: Current judicial decisions and interpretations affecting non-compete agreement enforceability and requirements.
