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Generally, this sort of agreement would be unenforceable in California pursuant to California Business and Professions Code section 16600, which states: "Except as provided in this chapter, every contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void."
Quite simply, if the agreement prohibits an employee from "engaging" in that same industry following termintion of employment in any manner, it falls within this definition. Restraint on the ability to do business with former clients clearly falls within this definition, and numerous California cases have expressly held so.
See here for a recent case in which the court invalidated an 18-month non-solicitation restriction on a former employee of a tax services company that prohibited the employee from providing services to any of the former employer's clients for a year: http://scholar.google.com/scholar_case?case=3664324957067638309&hl=en&as_sdt=2&as_vis=1&oi=scholarr
There are a few VERY narrow exceptions to the general rule that restraints on competition are unenforceable. The exceptions are a bit complex but include the following: (1) If an owner is selling the goodwill in their business (goodwill is the reputation and name of the business); (2) When there is a dissolution or disassociation of a partnership or (3) Where there is a dissolution of a limited liability company. There is also a limited exception for "trade secrets."
However, a general prohibition on doing business with former clients would almost certainly be unenforceable. Accordingly, an employee under the circumstances you describe would not typically be violating an enforceable contract by dealing with former clients. Thus, such employee could generally work with former clients without fear of a legal judgment being obtained against them.
If you are particularly concerned about being sued, you can request "declaratory relief" from the court. Decrlaratory relief is a sort of pre-emptive judgment, wherein the court decides an issue that will iminently result in a lawsuit before the actual lawsuit is filed against you. As noted, though, an employee who signs an agreement constituting a restraint on trade, as a prohibition from dealing with a specific client would clearly constitute, need not abide by the agreement as it is void in the state of California.
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