Terminations of Employment With and Without Cause

Non-compete agreements often hinge on the issue of whether an employee is terminated with or without cause or whether the employee, himself/herself, terminates the employment relationship.  Depending upon the language of the employment agreement, a non-compete provision may be less restrictive (or may have no effect) if an employer terminates the employee without cause.  See, e.g., Avisena, Inc. v. Santalo, 65 So. 3d 14 (Fla. 3d DCA 2011).  In Avisena, Inc., the founder of the company was terminated without cause by the employer.  The employer argued that a two year non-compete restriction applied and the former employee argued that the restrictive covenant lasted for only twelve months.  The Court found that the plain language of the agreement limited the time period to one year when the employer terminated the employment relationship without cause.  The contract was dense and complicated but the court found the restricted period was clear and concise and, therefore, rejected the employer’s argument that the 1-year/2-year provision was somehow ambiguous (which would have allowed the employer to offer evidence as to the parties’ intent in order to try and get to the 2-year restriction).  This is yet another example of the need for clear drafting as restricted time periods may directly be affected by the reason for the employee’s termination.  Kelsky Law, P.A., welcomes the opportunity to assist clients in drafting non-compete clauses.