If you run or manage a veterinary practice in California, the non-compete clause you may have tucked into your associate contracts is almost certainly unenforceable, and in 2024 the state made that fact harder to ignore. Here's a plain-English walk-through of where the law stands and why it matters.
The baseline rule: California voids almost all non-competes
California has been hostile to employee non-competes for well over a century. The core statute, Business and Professions Code section 16600, states that every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is, to that extent, void.
Courts have read that language broadly. Unlike most states, California does not apply a "reasonableness" test that lets employers enforce a narrowly tailored non-compete. The default is simple: the restraint is void, full stop. There are narrow statutory exceptions, chiefly tied to the sale of a business or the dissolution of a partnership or LLC, but those are about owners selling their stake, not rank-and-file employees changing jobs.
What changed in 2024
Two laws took effect January 1, 2024, and together they closed loopholes employers had leaned on.
SB 699 added section 16600.5, which makes a void non-compete unenforceable regardless of where and when the contract was signed. The target here is the out-of-state employer who hires in California and argues that another state's law (where non-competes are allowed) should govern. California's answer: it doesn't matter. An employer who tries to enforce or even impose such a clause may be committing a civil violation, and the law creates a private right of action, meaning a worker can sue.
AB 1076 codified the longstanding case law into section 16600.1, confirming that the ban reaches non-competes "no matter how narrowly tailored." It also added a notice requirement: employers had until February 14, 2024 to notify current and certain former employees, in writing, that any non-compete they'd signed was void. Missing that deadline is itself an act of unfair competition.
What about the federal FTC ban?
You may remember headlines about the Federal Trade Commission banning non-competes nationwide in 2024. That rule was challenged in court and did not take effect as written. For California employers, it's largely academic: state law already goes further than the federal rule would have. California's ban is the one that governs your contracts, and it's not going anywhere.
What this means for veterinary employers
Veterinary medicine is exactly the kind of field where non-competes get used and where California's rule bites hardest. A practice invests in an associate, builds a client base around them, and understandably doesn't want them walking across town to a competitor with a patient list. But in California, a clause forbidding that move is unenforceable, and continuing to paper contracts with one now carries real downside.
- Stop using employee non-competes. A boilerplate non-compete in your associate or technician contracts isn't protecting you. It's void, and post-2024 it can expose you to a lawsuit and unfair-competition liability.
- Send the notice if you haven't. If you had affected employees with non-compete language, the written-notice obligation already applied. Talk to counsel about curing a missed notice.
- Protect the interests you actually can. California still lets you protect trade secrets and confidential information, and reasonable, properly drafted non-solicitation of confidential data provisions. What you can't do is bar a former employee from practicing.
- Lean on retention, not restraint. When you can't legally fence people in, the practices that win are the ones people don't want to leave: competitive pay, manageable caseloads, and a work model that respects the team's time.
None of this is legal advice, and the wrinkles, especially around the business-sale exception and exactly which former employees needed notice, are worth running past an employment attorney. But the headline is clear: in California, the path to keeping good people runs through the workplace you build, not the contract you make them sign.
Keep your team without locking them in
When you can't legally fence people in, retention comes down to knowing how your team is doing before they decide to leave. Rally by Hound gives practice leaders real-time insight into team engagement, so you can act on burnout, pay concerns, and culture problems early, rather than scrambling after someone gives notice.
Sources: California Business and Professions Code § 16600, California Legislative Information; AB 1076 (2023–2024) and SB 699 (2023–2024), California State Legislature. This article is general information, not legal advice.