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Can Jimmy John's make Florida workers sign a noncompete clause?

business_litigation_noncompete_contracts_employment_frese_hansen.jpgIf you've been following national news stories over the last few months then chances are you've heard about the legal dispute involving Jimmy John's and its employment contracts. As you may know, the "freaky fast" sandwich shop is under scrutiny because of the company's use of noncompete clauses in its employment contracts -- a practice that is considered against the law in several states.

Although the state of New York seems to be at the center of the legal dispute, the issue at hand has not escaped the attention of our Florida readers who may have an important question on their minds: can Jimmy Johns make Florida workers sign a noncompete agreement? It's a question we hope to answer in today's post.

Like several other states, Florida has specific laws regarding noncompete agreements, which bar an employee from working for a competitor for a specified period of time after termination of employment. Prior to 1996, there was some confusion surrounding the use of such agreements, particularly because the law did not establish "any objective standard for the courts to use in determining the 'reasonableness' of a restriction upon competition."

F.S. §542.335, which was adopted by the Florida legislature in 1996, now requires employers to prove that a noncompete agreement is "'reasonably necessary' to protect one or more 'legitimate business interests" such as trade secrets or proprietary information. In the case of Jimmy John's, low-level workers likely are not privy to such trade secrets, which means asking them to sign such an agreement here in Florida may very well violate the law.

Even though the noncompete agreement is part of the standard hiring packet issued by the company's corporate office, it is up to franchise owners to review the terms of the employment contract to determine if any aspect of it violates state specific laws. If the franchise owner does not have the necessary legal background to make this assessment, then they should consult with a skilled lawyer who can tell them if they are adhering to the law or violating it by asking employees to sign a noncompete agreement.

Sources: The Florida Bar Journal, "Restrictive Covenants: Florida Returns to the Original 'Unfair Competition' Approach for the 21st Century," John A. Grant, Jr. and Thomas T. Steele , November 1996, Volume LXX, No. 10

The Huffington Post, "New York Attorney General Goes After Jimmy John's Over Noncompete Agreements," Dave Jamieson, Dec. 22, 2014

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