Florida’s CHOICE Act: What It Means for Your Business and the Use of Garden Leave Agreements

CHOICE Act

Florida’s new CHOICE Act, codified at sections 542.41 through 542.45, Florida Statutes, took effect on July 1, 2025. The Act represents a major shift in how businesses can structure post-employment restrictions for key employees. Short for the “Florida Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act,” the law expands the enforceability of noncompete agreements and formalizes the use of garden leave provisions under Florida law. Most notably, the law allows noncompete agreements to remain enforceable for up to four years, doubling the previous default period, so long as they meet statutory requirements. For agreements that qualify under the Act, the restriction runs in the geographic area the agreement defines. Section 542.335 was not amended, so its reasonableness analysis still governs every covenant that falls outside the Act. Courts must now issue injunctive relief for qualifying restrictive covenants, removing much of the judicial discretion that previously allowed judges to deny enforcement based on equitable considerations. A conforming agreement does not violate public policy as a restraint of trade and is enforceable according to its terms. The clear and convincing standard applies at a later stage: once the court enters the mandatory preliminary injunction, the employee can have it modified or dissolved only by proving, on nonconfidential evidence, that the new work will not be similar and no confidential information or customer relationships will be used, that the employer failed to pay the promised consideration and had a reasonable opportunity to cure, or that the hiring business is not engaged in or preparing to engage in similar activity in the agreement’s geographic area.

The Act defines a “covered employee” as an employee or individual contractor who earns, or is reasonably expected to earn, a salary greater than twice the annual mean wage of the Florida county where the employer has its principal place of business, or of the Florida county where the employee resides if the employer’s principal place of business is not in Florida. Salary means base compensation, so tips, bonuses, and commissions do not count toward the threshold. Whether the Act reaches a given agreement is a separate question: it applies where the employee’s primary place of work is in Florida, regardless of any choice of law provision, or where a Florida-headquartered employer’s agreement is expressly governed by Florida law. Health care practitioners, as defined in section 456.001, Florida Statutes, are excluded from coverage. Employers must advise employees in writing to seek legal counsel prior to signing, allow at least seven days for review, and obtain a written acknowledgment that the employee will receive confidential information or have access to customer relationships. A covered noncompete must also state that the noncompete period is reduced day for day by any nonworking portion of a garden leave notice period.

Garden Leave Agreements

One of the most important tools supported by the CHOICE Act is the garden leave agreement. In a garden leave arrangement, an employee remains on the company’s payroll for a defined notice period, which the CHOICE Act allows to run as long as four years, after notice of resignation or termination is given. During this time, the employee is prohibited from working for a competitor or starting a competing business but is still technically employed and paid. This arrangement provides the employer with a transition period to protect client relationships, preserve confidentiality, and limit the immediate sharing of sensitive information. Garden leave agreements are particularly effective for executives, managers, and other employees with access to proprietary data or high-value contacts. For example, if your CFO resigns, you could require a 60-day garden leave to wrap up sensitive projects and prevent them from immediately joining a competitor.

Under the CHOICE Act, the noncompete period must be reduced day for day by any nonworking portion of the garden leave notice period. Days the employee actually works do not count, and the agreement need only release the employee from providing services after the first 90 days, so a four-year noncompete is shortened only by the time the employee spent on the payroll without providing services. Notice requirements mandate that prospective employees receive a proposed noncompete at least seven days before an offer of employment expires, and that current employees get the same seven-day review period before an offer to sign expires.

How Florida SMBs Should Respond Now

Florida businesses, especially those in professional services, healthcare administration, finance, and technology, should reevaluate their current employment contracts in light of the CHOICE Act. The statute’s elimination of the “reasonableness” requirement for geographic scope allows broader protections, as long as the area is clearly defined. Enforcement provisions are highly favorable to employers. Upon application, courts must issue preliminary injunctions against violations. The burden is then on the new employer or employee to prove, by clear and convincing evidence, that the services are not similar, confidential information will not be used, or that the geographic restriction does not apply. Prevailing employers may recover monetary damages, and either party can recover attorney fees and costs.

Incorporating garden leave provisions can enhance an employer’s ability to safeguard trade secrets and goodwill. Legal counsel should review and update restrictive covenants to ensure compliance with the CHOICE Act’s requirements. The law’s changes move Florida toward one of the most employer-friendly jurisdictions for restrictive covenants. While beneficial for protecting business interests, these expanded powers require careful drafting and strict compliance to ensure enforceability.

Given the mandatory injunctive relief provisions, the removal of the “reasonableness” limitation, and the presumption of enforceability, the CHOICE Act significantly increases the legal weight of noncompete agreements in Florida. Employers should strategically adapt to leverage these changes, while employees should fully understand the potential scope and duration of restrictions before entering into such agreements. To safeguard your business interests, strengthen your competitive position, and better understand your options, contact Jimerson Birr.