Changes to Employment Agreements in Georgia.
Georgia employers and employees should be aware that major changes went into effect on May 11, 2011 with respect to employment agreements with non-compete, non-solict and non-disclosure provisions. Employment agreements signed prior to that date are not covered by these new laws, therefore if you want these laws applied to your current employment agreement (and that agreement was signed prior to May 11, 2011) you most likely will need to redo your employment contract in order to get the benefits of these new laws. While this law may not apply to all employees (such as low-level or entry-level employees), it does apply to directors, officers, managers, supervisors, key employees, personnel in possession of confidential information, employees with selective or specialized skills obtained through their employment and any party in a partnership agreement, franchise or license agreement.
One of the biggest changes to Georgia law regarding restrictive covenants is that Georgia courts are now allowed to “blue pencil” (partially enforce and/or modify) agreements that would have been considered overbroad in the past. Previously the courts would have just declared that the entire employment agreement was completely unenforceable if one of the restrictive covenants was overbroad, but now the Court can modify the agreement by striking out the overbroad provision. However, a good attorney should be able to help you draft an employment agreement which does not have any provisions which are overbroad.
Another important change involves non-competition restrictions placed upon former employees. The new law gives certain time periods within which the Court will view the non-competition restriction as either presumptively reasonable or presumptively unreasonable. So it is important to consult with an attorney so you can see if your employment agreement would be viewed by reasonable by the Courts. Also in the past, employment agreements were often unenforceable because the agreement had a non-compete provision that covered too large a geographic territory. The new law gives more specific guidelines as to what is allowed in terms of geographic restrictions. An attorney can help you tailor your employment agreement so that the geographic restriction is as large as our current laws allow. I’ve highlighted just a few of the biggest changes to the law above, but there are many other changes which went into effect in May 2011 so now is a good time to review your employment agreements with an Attorney to make sure that they comply with the current law.