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Noncompetition Agreements And You: What To Know

The presence of a noncompetition agreement in an employment agreement is probably the most misunderstood part of an employment agreement. Sometimes referred to as a covenant not to compete, they take on a wide scope of meaning depending on what the employer is trying to prevent the employee to do once the employee leaves his employer.

With more than 35 years of combined experience, our team at Rosenberg & Associates has a thorough understanding of noncompetition agreements and other employment contracts. We can undertake a comprehensive review of the document you signed, determine whether the terms and conditions are fair and, if not, explore your legal options.

From Gregg’s interview for the Masters of Employment Law series on

Am I Still Bound By My Noncompete?

In our practice, we typically are confronted with situations where an employee will come to us questioning whether or not a noncompetition agreement that was signed years ago is still valid. We see clients who don’t remember that they ever signed a noncompetition agreement and are reminded of it once they leave the company and are confronted with either a letter from their former employer or their lawyer telling them to “cease and desist” violating the noncompetition agreement by working for the new employer. Or, worse, they have been notified that their former employer is seeking a Temporary Restraining Order from a court seeking to prevent them from violating the noncompetition agreement.

Validity Of NonCompetition Agreements

Historically, Texas courts have been reluctant to enforce noncompetition agreements on the theory that they constituted a restraint of trade and as such were against the public policy of the state of Texas. Unfortunately, for those seeking to avoid the restrictions placed upon them by noncompetition agreements, both the Texas Legislature and the Texas Supreme Court have issued legislation and rulings that make it easier for an employer to enforce noncompetition agreements and restrict a former employee’s ability to compete.

All Is Not Lost

Despite the trend of the courts and the Legislature, Rosenberg & Associates has been successful in working with its clients to creatively, strategically and ethically utilize procedures to either defeat or reform (legally re-write) the noncompetitive restrictions to make them reasonable under the circumstances. Although it wouldn’t be good practice to share too much of how we take care of the needs of our clients confronted with constraints of noncompetition agreements through our website, the basic premise is that in order to be enforceable, a noncompetition agreement must pass two basic legal hurdles. First, the reviewing court must find that the restrictions that the noncompetition agreement complies with Texas law in that they are reasonable in terms of time, scope and geographical location. For example, a noncompetition agreement in Texas must be found to be reasonable by the examining court in all three of these aspects. If it is not reasonable, A Texas court can reform or re-write it to make it reasonable. Second, and most important, is that in Texas, a noncompetition agreement will only be enforced to an extent that s reasonably necessary to protect the legitimate goodwill expectations of the employer. On the face, this may read like a complicated phrase but the plain meaning provides leverage for a court to use its discretion to loosen the literal restriction when enforcement of the noncompetition agreement to the fullest extent would result in an unjust result.

We Fight Unfair Noncompete Agreements

If there is a common theme that has developed in the analyses of noncompetition cases through the years that this firm has been in existence through its various forms, is that there is no clear answer as to how a case involving a noncompetition agreement will turn out. However, we are always prepared to advocate for our you and negotiate aggressively on their behalves to limit the restrictions on you. When you contact us, you can ask us more questions and explore the options to this and other employment law problems.

Ask Us Your Questions And Schedule A Consultation

We see these types of cases on a weekly basis and would welcome the opportunity to discuss your noncompetition agreement case situation with you. You can fill out this questionnaire or call our Houston firm at 713-369-5978 to schedule a consultation about your contract. Our team is ready to help you understand your rights.