Independent Contractor Agreement With Non Compete Clause In Oakland
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If this form requires notarization, complete it online through a secure video call—no need to meet a notary in person or wait for an appointment.
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FAQ
As previously reported (Dentons Alert), the US Federal Trade Commission (“FTC”) issued a regulation earlier this year that effectively bans most non-competes for employees and independent contractors (the “FTC Rule”). The effective date of the FTC Rule is September 4, 2024.
Several factors can void or limit the enforceability of a non-compete agreement, including overly broad restrictions, unreasonable time frames or geographical limits, lack of consideration (such as compensation or job opportunities provided in exchange for the agreement), and violation of public policy.
As with many things, however, California is different. California law explicitly voids all non-compete agreements for employees and independent contractors. These agreements are simply not enforceable, no matter how reasonable they may seem.
Even workers labeled as “independent contractors”—who should have the freedom to work for multiple clients—are often required to sign non-competes that limit where they can work. Employers often present non-competes as a “take it or leave it” contract, forcing workers either to sign or forego employment.
The ban covers all non-competes for U.S. workers (including employees and independent contractors) with limited carve-outs, and is subject to certain exceptions based on the FTC's statutory authority.
The following are the most common ways to get out of a non-compete agreement: Determine that the terms of the contract do not in fact prevent you from a desired course of action. Recognize when a non-compete contradicts the law. Negotiate a release agreement with the involved parties. Ignore the agreement.
As with many things, however, California is different. California law explicitly voids all non-compete agreements for employees and independent contractors. These agreements are simply not enforceable, no matter how reasonable they may seem.
Add information about the parties involved. Describe the terms of the Non-Compete Agreement, such as the length and area of the restriction. If necessary, you can include a non-solicitation clause. Add a confidentiality clause.
In fact, California law prohibits the use of non-competes. Employers are liable for offering or forcing you to sign it. However, in states that allow them, a court might enforce the covenant until the job gets finished.
Every state has its own law regarding the use of non-competes. For example, in California, they are deemed illegal, except when selling a business or a shareholder's stock or dissolution of a partnership; while in Florida, they are allowed but are subject to strict scrutiny.
