Deciphering California's Shift: The New Landscape of Non-Compete Agreements

In recent updates, two bills – SB 699 and AB 1076 – have been brought to the spotlight concerning non-compete agreements in California.

SB 699: A Broader Umbrella
Previously, any contract that was deemed void under California law was rendered unenforceable. SB 699 reinforces this stance, ensuring that irrespective of the location or timing of an employee signing such a contract, it remains unenforceable. This makes the jurisdictional limitations clearer and aims to protect employees from contracts that could infringe on their rights.

AB 1076: Codifying the Edwards v. Arthur Andersen LLP Decision
Building on a precedent set by the Edwards v. Arthur Andersen LLP case, AB 1076 goes a step further. It enforces that any non-compete clause or agreement, regardless of its specificity or limited scope, is void when it comes to employment situations. There are a few exceptions, but they are limited in scope.

Furthermore, AB 1076 has also introduced added protections for employees. One of these is the requirement for California employers to notify employees about these changes. It's vital for businesses to be aware that not adhering to these rules could lead them to violate BPC 17200 and its subsequent sections.

Legal Implications and Updates
These recent amendments have made changes to the Business and Professions Code. Specifically, they modify Section 16600 and introduce new sections: 16600.1 and 16600.5.

Conclusion:
California continues to set the pace in strengthening employee protections against restrictive employment practices. It's essential for employers and employees alike to understand these changes to ensure they operate within the confines of the law.