Many companies have ceased using noncompete clauses for employees working in California. At best the clauses have become unenforceable, at worst, a liability for the company.

If you thought this issue was behind you, think again…

A change to California Business and Professions Code Section 16600, enacted as Section 16600.1 and effective January 1, 2024, requires employers to notify current and certain former employees who are signatories to any noncompete clause or agreement that the restriction is void. Employers must do this by February 14, 2024, or risk liability for an act of unfair competition under Section 17200, which provides remedies such as injunctions and restitution.

Specifically, Section 16600.1(b)(1) requires that employers provide notice to the following individuals:

1. Current employees whose contracts include a noncompete clause or who were required to enter a noncompete agreement; and
2. Former employees employed after January 1, 2022, whose contracts include a noncompete clause or who were required to enter a noncompete agreement.

The notice to employees must:

1. Be in writing;
2. Be an individualized communication to the employee;
3. Be mailed or hand delivered to the last known address of the employee;
4. Be emailed to the employee;
5. State that the employee’s noncompete clause

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