How State Law Treats Non-Solicitation Agreements

Under California Business and Professions Code § 16600, a contract is generally void if it keeps a person from working in their chosen profession or trade. The California Supreme Court has read this protection broadly in the employment setting and rejected a narrow-restraint exception for post-employment restrictions. A non-solicitation clause may bar a former employee from contacting customers or recruiting former coworkers, and although the wording differs from a traditional noncompete, the practical effect can be similar. In AMN Healthcare, Inc. v. Aya Healthcare Services, Inc., a California appellate court held that an employee non-solicitation provision violated the law because it restrained former recruiters from practicing their profession. These disputes depend heavily on the contract and the facts, and a Pasadena lawyer could determine which rules apply to a non-solicitation agreement, since restrictions tied to the sale of a business may fall within statutory exceptions.

Are Customer Non-Solicitation Clauses Enforceable?

A customer non-solicitation clause is not automatically valid merely because it avoids the words non-compete agreement. A court can examine whether the provision prevents an employee from performing lawful work, and a broad ban on contacting customers may be vulnerable when it operates as a restraint on professional activity. Employers still have legitimate rights, because California law can protect trade secrets and confidential business information.

A company cannot simply label every customer name or professional relationship confidential, and courts have rejected confidentiality language that interferes with an employee’s right to compete. A non-solicitation attorney in Pasadena could assess whether the employer is protecting genuine trade secrets or using confidentiality claims to disguise an unlawful restriction.

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