dc.description.abstract | Under civil law, individuals and groups have right to form contracts without government restrictions. Consequently, in modern society, employers may use covenant not to compete (hereinafter CNC) as a means to protect their business interests; whereas employees’ benefits may to some degree limited. And that cause decades of disharmony in employer-employee relationship. To deal with this controversial issue, according to literature analysis, the courts in most countries, tend to perform a case-by-case analysis of each contract, to determine whether the restriction is reasonable or not. However, there exists several exceptions that CNC is strictly prohibited; State of California is the icon among them.
It’s been more than a hundred years since 1872, as the California Business and Professions Code became effective. The code reflects the direction of policy of the government of California: facilitating market competition as well as talent mobility. This kind of policy has brought industries in California into great success, especially high-tech-intensive industry. And this unique policy model has been followed up by other states recently. The great effort of California is proven to be highly related to its distinct policy, not only in light of literature review in law-economic area, but also in interdisciplinary studies. In brief, if CNC is legal in a certain state, the talent mobility will probably be bound by contract. In the long run, from economic point of view, negative effect to the market, industries may come into being without a doubt.
The article will take policies, judicial constraints on employment contract and important related cases in the United States as example, collect and analyze studies in different academic fields such as psychology, business management, economic, etc., to try to come up with some advises to current relevant legal framework in Taiwan.
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