Assembly Bill 567 seeks to amend existing laws regarding covenants not to compete in employment contracts. The bill renames the relevant statute from "Restrictive covenants" to "Covenants not to compete in employment contracts" and establishes that such covenants are only lawful and enforceable during the term of employment or agency. Specifically, it makes any covenant that restricts competition after the termination of employment illegal, void, and unenforceable, even if it includes reasonable restraints. However, the bill allows for exceptions for nondisclosure agreements related to personal information and for covenants that restrict the unauthorized use of customer lists or intellectual property.

Additionally, the bill introduces definitions for terms such as "copyright," "customer list," "intellectual property," "nondisclosure agreement," "patent," and "trade secret." It mandates that employers post a notice in conspicuous locations, including their websites, informing employees that covenants not to compete after termination are considered unreasonable restraints on trade and are thus illegal. The provisions of this bill will apply to any new, extended, modified, or renewed covenants not to compete entered into on or after the effective date of the legislation.

Statutes affected:
Bill Text: 103.465(title), 103.465