Updated on November 14th, 2022

A California non-solicitation agreement is a document that legally obligates a person not to recruit, hire, or solicit a company’s employees or customers. Under California law, non-solicitation agreements are generally unenforceable. However, there are specific circumstances where these agreements can stand. California statutes permit non-solicitation agreements tied to the sale of a business, as well as contracts between business partners or LLC members. In these settings, the non-solicitation agreement would prohibit the restricted party from pursuing business transactions or professional relationships with specific individuals within or affiliated with the company.

Statutes: § 16600
Legally Enforceable? Yes, but only if a statutory exception applies. Non-solicitation agreements are enforceable against:
- The seller of a business entity (§ 16601).
- A business partner following their disassociation from, or the dissolution of, a partnership (§ 16602).
- An LLC member following the termination of their interest in, or the dissolution of, a limited liability company (§ 16602.5).
Requirements:
- Employee Solicitation: Agreements between the buyer and seller of a business may prohibit employee solicitation, but only those under employ when the sale took place.^[1]
- Customer Solicitation: Must be narrowly tailored for the employer’s protection and not overly broad as to be construed as a non-compete.^[2] These agreements are generally unenforceable unless:
  - - The customer contact information is a protectable trade secret; or
    - Enforcement of the agreement is required to safeguard the employer’s trade secrets.^[3]