A few months ago, this blog noted that there was press coverage about the nationwide increase in the use of noncompete agreements in various industries.  A story that has made the rounds in the past week illustrates this point clearly.  Jimmy Johns, a “gourmet sandwich” franchise, has apparently been inserting noncompete provisions in its employment

Last year, California revised Labor Code section 2751 such that any employment agreement involving “commission” payments would have to be put into writing with a signed copy of the agreement be given to the employee. Those revisions go into effect on January 1, 2013.
Continue Reading First “Commission” Agreements Must Be in Writing. Now the Definition of “Commissions” is Limited Under Labor Code § 2751

By:       James Kachmar

Readers of this blog will note that we frequently remind them that California law generally prohibits non-compete agreements. There are very limited exceptions to this general rule, one being that the seller of goodwill in a business can be bound by a valid non-compete agreement to protect the goodwill that is being purchased. Sometimes, the buyer of a company will want to continue to employ certain key employees, who can also be the sellers of the goodwill of the former company.   We have seen instances where the purchasing company gets creative and subjects the seller/key employee to two covenants not to compete, one in the purchase agreement and the other in an employment agreement.   Last week, a California appellate court shut the door on this approach in the case Fillpoint, LLC v. Maas.Continue Reading Another Door Closes on Non-Compete Agreements

By:     Chelcey E. Lieber

Including arbitration provisions in employment agreements or employee handbooks is not a guaranteed way to avoid the courtroom. On January 3, 2012, the California Court of Appeal upheld a decision from the Sacramento County Superior Court holding that an arbitration provision contained in a pre-employment agreement was unconscionable, and, therefore, unenforceable.Continue Reading California Pre-Employment Arbitration Agreement Ruled Unconscionable