The General Assembly finds that reasonable restrictive covenants contained in employment and commercial contracts serve the legitimate purpose of protecting legitimate business interests and creating an environment that is favorable to attracting commercial enterprises to Georgia and keeping existing businesses within the state. Further, the General Assembly desires to provide statutory guidance so that all parties to such agreements may be certain of the validity and enforceability of such provisions and may know their rights and duties according to such provisions.
(Code 1981, §13-8-50, enacted by Ga. L. 2011, p. 399, § 4/HB 30.)
Law reviews.- For article, "Contracts: Illegal and Void Contracts Generally," see 28 Ga. St. U.L. Rev. 21 (2011). For annual survey on labor and employment law, see 64 Mercer L. Rev. 173 (2012). For annual survey on labor and employment law, see 69 Mercer L. Rev. 141 (2017). For note, "Balancing the Scales: Reforming Georgia's Common Law in Evaluating Restrictive Covenants Ancillary to Employment Contracts," 46 Ga. L. Rev. 1117 (2012).
JUDICIAL DECISIONS
Enforcement of covenants would be against Georgia law and public policy.
- Trial court did not err by refusing to enforce the forum selection and choice of law clauses requiring Texas law to govern an employment contract and by dismissing the complaint because a Texas court applying Texas law would enforce non-compete covenants that were unenforceable under applicable Georgia law and public policy. Lapolla Indus. v. Hess, 325 Ga. App. 256, 750 S.E.2d 467 (2013).
In a declaratory judgment action seeking a declaration as to the enforceability of non-compete clauses in an employment contract, the trial court properly granted the competitor judgment on the pleadings because the trial court correctly found that the pleadings showed that the lack of any limit on the scope of the restricted work or the solicitation of former customers were void and unenforceable under the non-severability rule as a matter of law. Lapolla Indus. v. Hess, 325 Ga. App. 256, 750 S.E.2d 467 (2013).
Trial court did not err in refusing to enforce a choice of law provision in the 2014 agreement containing restrictive covenants and by applying Georgia law rather than Delaware law because a choice of law provision would not be enforced if application of the clause contravened a strong public policy of Georgia; before the enactment of the restrictive covenants act, restrictive covenants in restraint of trade fell within that public policy exception if (1) at least one of the restrictive covenants violated Georgia public policy and (2) such a covenant would likely be enforced by the other state's court; and the act did not change the prior conclusion that unreasonable restrictive covenants were against Georgia public policy. Belt Power, LLC v. Reed, 354 Ga. App. 289, 840 S.E.2d 765 (2020).
Cited in Crump Ins. Servs. v. All Risks, Ltd., 315 Ga. App. 490, 727 S.E.2d 131 (2012).