HB352 Summary

• Voids any contract that restrains a person from exercising a lawful profession, trade, or business except as specifically permitted by this act.

• Allows six types of restrictive covenants to protect legitimate business interests: employee non-compete agreements (2-year restraint presumed reasonable), non-solicitation agreements (18 months or duration of post-separation pay presumed reasonable), business sale agreements (1-year restraint presumed reasonable), partnerships dissolving, exclusive dealing agreements, and hiring restrictions for uniquely essential employees.

• Defines protectable interests to include trade secrets, confidential information, customer relationships and goodwill, specialized training with substantial business expense, but excludes general job skills.

• Requires all restrictive covenants to be in writing, signed by all parties, and supported by adequate consideration; courts may partially void or reform overly broad or unreasonably long restraints.

• Repeals Section 8-1-1 of the Code of Alabama 1975 and establishes that this act expresses fundamental Alabama public policy, superseding foreign law; effective January 1, 2016.