Understanding the New Rules for Noncompete and Garden Leave Agreements in Florida

On July 3, 2025, the Florida CHOICE Act became law, dramatically changing how restrictive employment agreements are drafted, enforced, and litigated in Florida. The law — formally known as the Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth Act — creates a system of “presumptive enforceability” for two types of employment contracts:

• Covered garden leave agreements
• Covered noncompete agreements

If an agreement meets the new statutory requirements, courts must assume the agreement is valid and enforce it — including mandatory injunctions to stop violations. This article breaks down the key provisions and illustrates how they work through examples.

What Is a Garden Leave Agreement?

A garden leave agreement is a contract term that applies before employment officially ends. It allows an employer to keep an employee on the payroll, with full salary and benefits, even though the employee is no longer performing any work.

The CHOICE Act turns this into a powerful tool by requiring advance written notice of termination — from either side — for a period that can be up to four years.

Example 1: Using a Garden Leave to Prevent Sudden Resignation

Scenario:

Natalie is the Head of Sales at a Florida software firm. She has access to client pricing models and pipeline forecasts. The company is worried that if she resigns suddenly, she could jump to a competitor and use that information against them.

CHOICE Act Garden Leave Agreement:

• Natalie agrees she will give the company two years’ notice before resigning.
• In return, the company agrees to give two years’ notice before firing her (except for gross misconduct).
• During the first 90 days of the notice period, she may be asked to help train her replacement.
• After that, she’s on “garden leave” — no duties, still paid full salary.
• With written permission, she may consult for a non-competing firm.

Benefit:

This structure prevents Natalie from quitting suddenly and taking key accounts with her. It gives the company time to protect client relationships and reinforce trade secret safeguards — while honoring her right to be compensated.

What Makes a Garden Leave Agreement “Covered” Under the CHOICE Act?

To gain presumptive enforceability, the agreement must meet all of the following:

1. The notice period must be no more than four years.
2. The employer must:
   • Inform the employee in writing that they may consult an attorney.
   • Give them at least 7 days to review the agreement before signing.
3. The employee must acknowledge in writing that they will receive confidential information or customer access.
4. After 90 days of the notice period, the employee:
   • Cannot be required to work;
   • Can engage in nonwork activities, even full-time hobbies;
   • May work elsewhere, if the employer approves.
5. The employer can shorten the notice period with 30 days’ written notice.

Gross Misconduct: When Garden Leave Payments Can Be Cut

Employers are allowed to reduce pay or benefits during the notice period if the employee engages in gross misconduct — though the term is not defined in the statute.

Example 2: Misconduct During Garden Leave

Scenario:

Daniel, an R&D engineer, is placed on a one-year garden leave after giving notice. During that time, he downloads a confidential product prototype to a personal USB device.

Result:

The employer learns of the conduct and invokes the “gross misconduct” clause. Under the CHOICE Act, the employer may lawfully reduce his salary or benefits without breaching the agreement.

What Is a Covered Noncompete Agreement?

A noncompete agreement prevents an employee from joining a competing business or starting one of their own that would compete with their former employer.

Under the CHOICE Act, to be “covered” and presumptively enforceable, a noncompete agreement must:

1. Be in writing, with the employee given:
   • Notice of their right to consult a lawyer;
   • At least 7 days to review before signing.
2. Include a written acknowledgment that the employee will receive confidential information or client exposure.
   • Prohibit the employee from:
     Working for a competitor;
   • Using the employer’s confidential information or client contacts.
3. Limit the noncompete period to 4 years or less.
4. Subtract any nonworking garden leave time from the noncompete period, day-for-day.

Example 3: Day-for-Day Reduction of Noncompete Time

Scenario:

Tania, a marketing executive, signs a CHOICE Act-compliant noncompete that lasts 2 years. When she resigns, she is placed on a 1-year garden leave during which she does not work.

Result:

Her 2-year noncompete is reduced by 365 days — she only has 1 year of restriction remaining once her employment officially ends.

No Geographic Limits Required

Unlike traditional noncompetes under Florida Statutes § 542.335, the CHOICE Act does not require a specific geographic boundary. If the agreement defines a territory (e.g., “North America,” or “any country where the employer operates”), it is enforceable as written — even globally.

Mandatory Injunctive Relief: Automatic Court Orders to Enforce

If a covered agreement is violated, the CHOICE Act gives courts no discretion — they must issue a preliminary injunction to stop the breach.

This includes:

• Ordering the employee to stop the competing work; and
• Ordering any new employer to stop employing the individual.

Example 4: Court-Ordered Ban on Working for Competitor

Scenario:

A covered employee, Jordan, signs a 3-year noncompete after being granted stock options and access to client data. One month after quitting, he takes a job at a direct competitor.

Result:

The former employer sues under the CHOICE Act. The court:

• Immediately issues an injunction forcing Jordan to stop working for the competitor.
• Bars the new employer from employing Jordan during the remainder of the restricted period.

Unless Jordan can prove by clear and convincing evidence that the job does not involve similar services or confidential knowledge — or that he wasn’t paid under the agreement — the injunction stays in place.

What’s Excluded from the CHOICE Act?

The CHOICE Act does not apply to:

• Healthcare professionals, such as doctors or nurses;
• Standalone confidentiality or non-solicitation agreements;
• Any agreement that does not meet the statute’s specific requirements.

These remain governed by Florida’s general restrictive covenant law, § 542.335, which uses a “legitimate business interest” test.

What Should Employers Do Now?

To take advantage of the CHOICE Act, Florida employers should:

1. Review existing agreements — and revise those that don’t meet CHOICE requirements.
2. Add legal review windows to onboarding workflows.
3. Ensure employees sign acknowledgments of confidential information or client contact.
4. Update internal checklists for promotions and senior hires.
5. Train HR and legal teams on how to identify covered employees and prepare enforceable documents.

Precision Pays Off

The CHOICE Act rewards careful planning and clear drafting. By complying with its provisions, employers gain access to strong enforcement rights and reduced litigation risk. Meanwhile, employees receive meaningful protections — including advance notice, pay stability, and time to review agreements with counsel.

Used properly, the CHOICE Act is designed to create a legal environment that supports investment in talent, promotes fair competition, and protects proprietary information in Florida’s fast-growing business economy.