California recently enacted AB 1076, which reinforces the state’s broad statutory ban on noncompete agreements. The law took effect on January 1, 2024, and expressly codifies Edwards v. Arthur Anderson LLP, 44 Cal. 4th 937 (2008), a California Supreme Court opinion barring any noncompete, no matter how narrowly tailored it may be. The new law also affirms that California’s prohibition against noncompete agreements is not limited to contracts in which the person being restrained from engaging in a lawful profession, trade, or business is a party to the contract. While the limits of this provision have yet to be tested in court, at the very least it would appear to codify existing case law prohibiting “no-hire” agreements between and among employers.
The notice must be in the form of a “written individualized communication” delivered to the employee’s last known address and email address.
It’s Almost Valentine’s Day – And Love and Noncompetes Are In the Air!
Proskauer | Feb 2024
Effective date: 1/01/24
Notice due by: 2/14/24
Text of the measure.
Notices Must be Individualized Communications
The notice must be in the form of a “written individualized communication” delivered to the employee’s last known address and email address.
It’s Almost Valentine’s Day – And Love and Noncompetes Are In the Air!
Proskauer | Feb 2024
These notices need to be specific to each employee and individually addressed, and so will likely involve some investment in time and effort by employers to ensure compliance with the law.
Reminder: California Noncompete Deadline Is February 14
Morgan Lewis | Feb 2024
Additional Law Firm Articles
AB 1076 requires employers to send a notice to employees informing them that any noncompete agreements or noncompete provisions in their employment contract are void in California. The notice must be written and delivered to the employee's last known postal address and email address. Employers must notify applicable employees by Feb. 14, 2024. Failure to provide notice constitutes a violation of the UCL Bus. & Prof. Code §§ 17200, et seq., and civil penalties of up to $2,500 per violation may be imposed on noncompliant employers.
California Noncompete Regulation Requires Employer Action by Feb. 14, 2024
Holland & Knight | Feb 2024
While this modification does not appear to impact the application or interpretation of California law, it remains to be seen whether Courts will conclude that restrictions aimed at protecting trade secrets remain enforceable.
Valentine’s Day “Gift” For Employers With California Employees That Work Under Noncompete Agreements
CDF Law | Oct 2023
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