As previously highlighted by Benesch, California strengthened its long-standing prohibition on non-competition agreements on January 1, 2024.
In addition, and also as previously highlighted by Benesch, one of these amendments established what has commonly now been called the “Valentine’s Day Deadline” by many California employers: by February 14, 2024, employers must provide notice to all current employees in California, as well as all former employees in California who were employed after January 1, 2022, that any non-competition clauses to which they agreed are void and unenforceable. Importantly, this notice (1) must be individualized; and (2) must be sent via mail to a (current or former) employee’s last known mailing address and via email to a (current or former) employee’s last known email address. Failure to provide proper notice constitutes unfair competition under California law and can result in a penalty of $2,500 per violation. Violations can also lead to recovery of attorneys’ fees and costs. It is unclear as of now whether this law applies to non-solicitation provisions, but California courts have in the past treated customer non-solicitation provisions as unenforceable non-competition provisions.
Although many might be tracking down a last-minute gift or securing a dinner reservation in the eleventh hour before Valentine’s Day, California employers (and all employers with employees in California) should ensure that they comply with California’s “Valentine’s Day Deadline” and send appropriate notices to all current employees and former employees who were employed after January 1, 2022.
For more information, contact:
Margo Wolf O'Donnell at modonnell@beneschlaw.com or 312.212.4982.
Charles Leuin at cleuin@beneschlaw.com or 312.624.6344.
Scott Humphrey at shumphrey@beneschlaw.com or 312.624.6420.
Alex Ehler at paehler@beneschlaw.com or 312.506.3435.