As of its July 3, 2025 effective date, the Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (“CHOICE”) Act dramatically overhauled Florida’s restrictive covenant framework. While many states have passed, or are considering passing, legislation to restrict the legality of noncompete and other restrictive covenant agreements, Florida enacted one of the most—if not the most—pro–noncompete laws in the country. As a result, Florida-based employers, and employers who employ individuals who primarily perform work in Florida, have additional tools in the arsenal to prevent “covered employees” from engaging in unfair competition.
Who Qualifies as a Covered Employee?
The law defines a “covered employee” as an employee or independent contractor who earns, or is reasonably expected to earn, a base salary of at least twice the annual mean wage for the Florida county in which the employer has its principal place of business or, if the employer’s principal place of business is not in Florida, the Florida county in which the employee resides. Depending upon the county, the above compensation threshold could range anywhere from approximately $80,000 to nearly $150,000 based on current estimates.
Additionally, the CHOICE Act applies only to: (1) “covered employees” who maintain a primary place of work in Florida (regardless of the choice of law provision in the covered agreement—more on that below) or (2) employers whose principal place of business is in Florida and where the covered agreement is expressly governed by Florida law.
Notably, licensed healthcare providers as defined under the law are specifically excluded, meaning their restrictive agreements continue to fall under Florida’s original restrictive covenant regime.
What Types of Agreements Does the CHOICE Act Apply To?
The CHOICE Act governs two types of restrictive covenant agreements: “covered noncompete agreements” and “covered garden leave agreements” which are defined as follows:
- “Covered Noncompete Agreements” – A written agreement with a “covered employee” in which, for a period “not to exceed 4 years and within the geographic area defined in the agreement,” the “covered employee” agrees not to take “a role with or for another business, entity, or individual” in which the individual: (i) would provide services similar to those provided to the employer during the 3 year period preceding the noncompete period; or (ii) is “reasonably likely” to use the employer’s confidential information or customer relationships. The agreement must also specify that the noncompete period will be reduced “day-for-day” by any concurrent garden leave period, if applicable.
- “Covered Garden Leave Agreements” – A written agreement with a “covered employee” in which the “covered employee” receives salary and certain benefits throughout a notice period of no more than 4 years, in exchange for agreeing not to: (i) resign during such notice period; and (ii) compete with the employer during such notice period. The agreement must also state that the employer may unilaterally reduce the garden leave period with at least 30 days’ advanced written notice, and that after the first 90 days of the garden leave period, the “covered employee” may cease providing any services to the employer, among other requirements.
To qualify as a “covered noncompete agreement” or “covered garden leave agreement,” the contract must advise the individual of their right to seek legal counsel, provide at least 7 days for review prior to execution, and include a written acknowledgment from the “covered employee” confirming receipt of confidential information or substantial client relationships during employment.
As noted above, employers are now permitted to require “covered employees” to abide by noncompete periods of up to four years—a significant expansion of Florida law, which previously codified a statutory presumption that noncompetes longer than two years are unenforceable.
Are There New Enforcement Powers Afforded to Employers?
The CHOICE Act also establishes strong enforcement mechanisms for the benefit of employers. Specifically, the law states that courts are required to issue preliminary injunctions to enforce covered agreements unless the “covered employee” can prove by “clear and convincing evidence” that:
- They will not breach the covered agreement or use the employer’s confidential information or customer relationships;
- In the case of a “covered garden leave agreement” only, the employer failed to pay or provide the salary and benefits required under the agreement during the garden leave period and has had a reasonable opportunity to cure the failure; or
- In the case of a “covered noncompete agreement” only, the business, entity, or individual seeking to employ or engage the covered employee is not engaged in, and is not planning or preparing to engage in during the noncompete period, business activity similar to that of the covered employer in the geographic area specified in the agreement.
The CHOICE Act also includes provisions requiring courts to issue preliminary injunctions against putative employers of individuals who have executed covered agreements and outlines the conditions under which such injunctions may be dissolved.
Similar to existing law, an employer can also recover all monetary damages and the prevailing party in any action to enforce a covered agreement is entitled to reasonable attorney’s fees and costs.
How Does the CHOICE Act Interplay with Existing Law?
Notably, the CHOICE Act does not replace Florida’s existing legal framework for restrictive covenants. If a new restrictive covenant agreement does not qualify as a “covered noncompete agreement” or “covered garden leave agreement,” it will not be governed by the CHOICE Act, but instead will fall under pre-existing Florida law. Similarly, any restrictive covenant agreements entered into before the CHOICE Act’s effective date will continue to be governed by pre-existing law.
What Should Employers Do Next?
Florida-based employers, as well as those who employ individuals who primarily perform work in Florida, should speak with counsel to understand the ins and outs of this new law and stay up to date on any legal developments, as the CHOICE Act is expected to face significant legal challenges. Additionally, employers should:
- Consider auditing and updating existing noncompete and garden leave agreement templates to take advantage of the new employer-friendly protections; and
- Review hiring practices to ensure the CHOICE Act is not violated when hiring or engaging new employees or independent contractors.
