October marks the return of the World Series, the joy of costumed children seeking candy from strangers (with-can you believe it-their parents’ permission), and the resumption of little leaguers trying their best to learn the basics of America’s pastime. With all of this going on, it seems appropriate to comment on the similarities of these rites of Fall and the law of Florida Non-Competition Agreements.
To begin the discussion, Florida allows non-competition agreements under limited circumstances. Florida codified its guidelines for non-competition agreements in Florida Statutes Chapter 542, Combinations Restricting Trade or Commerce. Within this statute is §542.335, Valid restraints of trade or commerce. This carve-out specifically allows employers and employees-in writing-to establish “reasonable” bases for a departing employee not to compete against the former employer for a defined period of time. The statute allows for enforcement procedures, and even recommends time periods and geographic restrictions that are presumed reasonable.
Professional baseball has restricted free agents. Even trick-or-treaters have specified guidelines (typically along the lines: “no open candy;” “no fruit from people you don’t actually know;” and “avoid the ‘Boo Radley House'”). However the politics of little league have a feel somewhat familiar to those of us who draft and litigate Florida non-competition agreements. In my son’s league, as in many leagues, there is a coaches’ draft. The “rules” of the draft are intended to ensure fair teams and educational opportunities for all of the young players. The reality of the draft (and of the league) is that certain players are somehow “protected” and that competition is intentionally restricted to allow some continuity and familiarity.
In Florida, businesses and employees are allowed under the statutory guidelines to enter into contracts that restrict future employment. Generally speaking, courts are unlikely to interpret the statute to allow companies to restrict the future employment of low-level employees. However the restrictions are available for higher level employees and are increased in time based on the departing employee’s ownership interest and the departing employee’s level of exposure to the former employer’s confidential business operations.
The little league draft operates similarly, albeit without the written guidelines. The most “productive” players from the previous year somehow consistently end up on the same team with the same coaches. On the other hand-similar to employees in Florida-players who are still “developing their skills” tend not to receive the same “protection.” And so it went for one of my sons when he found out that he would play on a new team with new coaches and no one with whom he was in class, or with whom he played previously. He understood that the freedom to experience a new situation was essentially the flip side of someone whom the system “protected” because of a skill that a former employer did not want a competitor to exploit.
It was a tough lesson for a seven year old to learn. At first, he was both discouraged and a bit demoralized. As parents, we had no choice other than to cheer him on and help him practice the lessons his new coaches taught. Losing (badly) to his former team didn’t much help his confidence. However, like any good business, it’s important to spot talent and to take appropriate legal measures to protect those employees whose talents might result in future growth.
These are good lessons for any business. These are also good lessons for little leaguers. Not every kid is going to hit a homerun. Not every kid will make the play at third base. Although on Saturday… my kid did!