are non compete agreements for indipendent contractors inforceable?

I have owned a trade specific company for 12 years. Approx 8 years ago I was asked by a national company if I would continue to run my business under the national name which I agreed. There were no contracts and my company was an independent contractor better yet more like a franchise because we were not compensated by the National organization we paid them a fee to be part of the organization. 4 years ago the National company was bought by a huge conglomerate. This Conglomerate made all the individual companies sign a non compete or they could not continue doing business. is this non compete enforceable even if the inipendent contractor or company was in business prior and was not compensated by the conglerate, in fact we paid fees to the conglomate.  

1 answer  |  asked Jan 12, 2012 10:00 PM [EST]  |  applies to Florida

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Answers (1)

Phyllis Towzey
Yes, it's enforceable under Florida law, so long as the national company has a legitimate business interest to protect, and the restrictions are not overly broad. Fla.Stat. Section 542,335. See:
http://www.leg.state.fl.us/statutes/index.cfm?App_mode=Display_Statute&Search_String=&URL=0500-0599/0542/Sections/0542.335.html

Under Florida law it's irrelevant whether the independent contractor was already in business at the time the agreement was signed. Florida law also doesn't not require separate "consideration" (i.e. payment) in exchange for signing a noncompete -- the ability to continue to do business with them under the national name is consideration enough.

However, in some states, those factors would make a difference as to whether the agreement is enforceable. If you are doing business in states other than Florida, you need to check the laws in those jurisdictions as well.

posted by Phyllis Towzey  |  Jan 13, 2012 08:01 AM [EST]

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