The (Less-Than-Golden) State of Confidentiality Provisions in California
It is well known that California takes a dim view towards restrictive covenants in the workplac e. Business & Professions Code Section 16600 prohibits employee non-compete agreements, stating that “ every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” This statute has been read broadly and has been applied to both non-compete and non-solicitation provisions in employment contracts. AMN Healthcare, Inc. v. Aya Healthcare Servs., Inc ., 28 Cal. App. 5th 923, 929 (2018). Despite courts’ enthusiasm in applying Section 16600 to non-competes and non-solicits, courts have long held that confidentiality agreements do not violate Section 16600. Fowler v. Varian Assocs., Inc. (1987) 196 Cal. App. 3d 34, 44 (“[A]greements designed to protect an employer’s proprietary information do not violate section 16600.”); Neville v. Chudacoff (2008) 160 Cal. App. 4th 1255, 1270 (citations ...