I personally think California made the right call banning them outright. The rest of the country would do well to follow suit.
I'm talking about short-term, individual ways to solve your own noncompete problem.
I'm talking about short-term, individual ways to solve your own noncompete problem.
Bottom line: if a company demands that you sign a noncompete agreement, that's your cue to ask for a chunk of the company.
In California, "every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void", except for certain enumerated exceptions (Cal. Bus. & Prof. Code, Sec. 16600 [BPC 16600])
Those enumerated exceptions are, in summary form:
(1) Someone selling a business and/or its goodwill may agree not to compete with the business thus sold, if the new owner is carrying on the same kind of business (BPC 16601).
(2) Partners in a partnership may enter an agreement in anticipation of an eventual separation from the partnership, such as they would be able to do when selling their interest as described in 1, as may members of an LLC, mutatis mutandis. (BPC 16602, 16602.5)
Receiving equity in a business doesn't seem to qualify for any exception.
Employers include them in contracts to scare people, and generally it works.