Florida’s Third District Court of Appeal, construing a non-compete provision in an employment agreement, ruled this week that the phrase “employee’s termination of employment with the company” “unambiguously refers to the employee’s own termination of his or her employment.” Avisena v. Santalo, Case No. 3D10-178 (Fla. 3d DCA, May 4, 2011) (emphasis supplied).
The effect of the court’s ruling was that the employee, who had been terminated by the company, was not bound by the longer non-compete restriction that would have applied if he had left on his own accord. The court, therefore, affirmed the trial court’s denial of the company’s motion for a temporary injunction.
Ironically, I have heard employees’ attorneys argue that the words "employee's termination” mean precisely the opposite of the Third DCA’s interpretation. These attorneys say that when an employee’s personnel file reflects an employee’s “termination,” that suggests the company terminated the employee. According to these plaintiffs’ lawyers, if the employee actually resigned, documenting a “termination” in a personnel file, or in a response to a request for employment verification, could constitute defamation; or, in the case of an employee who had engaged in protected activity before she resigned, retaliation.
I always considered such arguments to be dubious, and still do. But I also think the Third DCA got it wrong in Avisena. As Judge Schwartz noted in his dissenting opinion, the word “termination” “simply means the end of given period of time or relationship, regardless of how it occurs.” The word “termination” and the phrase “employee’s termination” do not unambiguously describe who initiated the termination. If your employment contracts are premised on the assumption that the word “termination” carries an unambiguous meaning, you may want to revisit those contracts. Avisena’s attorneys are probably doing that right now.