Breach of Contract Lawsuits Brewing over Amazon Non-Compete?
In news possibly affecting Orlando breach of contract news readers, Amazon has recently started requiring its warehouse employees to sign non-compete contracts, which could spur some breach of contract lawsuits in Orlando and elsewhere. Non-compete covenants in employment contracts have typically been used to prevent high ranking officers or uniquely skilled workers from leaving their employer to join a competing business within a set time, usually between one and three years. The rationale is that these executives and workers learned from and had access to the former business’s confidential information, trade secrets and customer base that they could potentially take and use at a competitor, which would injure the former company and force them to file a breach of contract lawsuit.
Amazon runs one of the largest and most sophisticated retailing businesses in the USA. But a lot of the work is unskilled and involves the “heavy lifting” part of the Amazon business. Most of Amazon’s workers are located in warehouses throughout the country. They’re the ones who select and ship products purchased by online buyers. Amazon usually pays its workers a couple dollars per hour more than comparable employers, making them Amazon a desirable workplace for some salaried workers. My first question would be why does Amazon want its warehouse staff to sign non-compete contracts?
More importantly, and the question that will be addressed below, is: Is Amazon’s non-compete contract actually enforceable if it were involved in a breach of contract lawsuit with a worker in Florida?
First, we’ll start with the language of the Amazon non-compete contract. Sources report that Amazon’s agreement states in part:
During employment and for 18 months after the Separation Date, Employee will not, directly or indirectly, whether on Employee’s own behalf or on behalf of any other entity (for example, as an employee, agent, partner, or consultant), engage in or support the development, manufacture, marketing, or sale of any product or service that competes or is intended to compete with any product or service sold, offered, or otherwise provided by Amazon (or intended to be sold, offered, or otherwise provided by Amazon in the future) that Employee worked on or supported, or about which Employee obtained or received Confidential Information.
Second, we’ll look at Florida law on the topic. The Florida Legislature has seen fit to enact a statute that governs all non-compete contracts, non-solicitation contracts, and similar agreements Under Florida law, which is Florida Statutes 542.335 and Orlando breach of contract law, Amazon would have to prove that that it had a “legitimate business interest” that supports the restrictive covenant. We’ll look at and analyze Amazon’s non-compete contract and the statute in part 2 of this breach of contract blog post so read on!