Working in some Texas industries can involve handling proprietary information or ground-breaking research, which employers need to protect. One of the ways they do this is by having employees sign non-compete agreements to prevent workers from sharing their secrets with other companies.
These contracts are usually part of your standard employment agreement, but what impact can they have on your freedom to change jobs and advance? What happens if you break a non-compete? Let’s examine some common questions and how your decisions surrounding non-compete agreements might affect your career.
Understanding Non-Compete Agreements
A non-compete clause is included as part of a contract or legal agreement stating that the employee cannot take a job at any of their former employer’s competitors when they leave the company. The agreements typically include language forbidding disclosure of any confidential or proprietary info to any third party, even if that party is not working with or employed by a competitor.
These clauses typically restrict the worker for between six months and two years. The goal, from the business’s point of view, is to keep employees from gaining knowledge and training, then taking that directly to a competitor. Because this can limit where an employee may work for the duration of the agreement, employers may be required to provide a salary during this period.
Each agreement will vary depending on the demands of the employer, so it’s highly recommended that you have a contract attorney look at it before you sign. Remember that companies are more interested in protecting their financial health and trade secrets than taking care of you when you separate from their employment.
Are Non-Compete Agreements Enforceable in Texas?
Texas is an employment-at-will state, meaning you have the right to leave your job at any time, and your employer can terminate your job (with a valid reason). Even with this policy in place, non-compete contracts are nearly always enforceable in Texas.
They are legally binding, and breaking one can result in legal action against you from the employer. These agreements must meet certain conditions, however, to be considered reasonable. These conditions include:
- The agreement must be part of another enforceable agreement, such as your contract for employment.
- It must spell out a reasonable scope of activity.
- It should be reasonable in the geographic area it covers. For instance, it shouldn’t include parts of the state, country, or world where the employer does not have competition.
- The contact must have a reasonable duration.
When deciding if your non-compete is enforceable, a court will examine whether the agreement is overly broad or restrictive for you. The employer will need to prove that not enforcing the contract will harm its business interests. The employee will need to show how the agreement unfairly limits their ability to make a living in their field of practice.
Is My Non-Compete Agreement Valid if I am Fired?
Non-competes are still valid even if you’re fired from your job. The agreement is more focused on what happens after you leave an employer, regardless of the circumstances, so it still applies. Whether you were let go for legally invalid reasons is another matter, such as if you were discriminated against or retaliated against.
However, there could be complications that allow you to escape the confines of a non-compete agreement. This all depends on how and why you were fired, as well as any existing precedents for cases like yours. For example, if you are terminated in a way that violates your protected rights under various employment laws, you could file a claim with the Equal Employment Opportunity Commission (EEOC).
You may have several options or none, and it all comes down to how your non-compete was written. Each case will be unique, and an experienced contract dispute attorney can help you understand your possible avenues for relief.
What Happens if You Break a Non-Compete Agreement?
Non-compete agreements are meant to protect everyone involved. Employers have a legal fallback for keeping their unique knowledge from being unfairly shared. Employees can receive compensation for avoiding competitors for a specific period of time. However, some individuals may be tempted to break their non-competes out of spite for a former company or due to desperation to find work.
If you feel your non-compete agreement is overly burdensome, you can work with an attorney to dispute the terms of the contract and attempt to release yourself from it. However, simply breaking the agreement outright puts you at risk of legal action from your former employer. When that happens, you’ll need qualified legal guidance and representation from a team who understands the nuances of Texas employment and contract law.
You can potentially claim certain defenses, such as the employer breached the contract and you are no longer bound by it, or it was overly broad. With a thorough investigation, your Houston non-compete lawyer may find that the company engaged in illegitimate business affairs, thereby casting doubt on the validity of an agreement with them. Again, each case is unique and must be examined closely.
Get Help Understanding Your Non-Compete Agreement Today
Just like any legally binding contract, the nuances of non-compete agreements can vary widely. They may be valid and fair, or they could unreasonably restrict your ability to earn a livelihood after you leave your employer. Understanding how your situation should be handled takes skill and a strong background in interpreting Texas employment law.
When you have concerns or questions about your non-compete contract, reach out to the Houston business litigation lawyers at Berg Plummer Johnson & Raval, LLP. Our team of top-notch Houston business litigation lawyers has successfully litigated non-compete claims on behalf of employees through every stage of the process. We will review your agreement and advise on how best to proceed, and we can help you if you’ve been accused of breaching the contract.
We can educate you on the full process, from how long your case may take to what costs you can expect to bear. Our team believes in protecting the rights of those who have been treated unfairly, and we can work with you to develop a reasonable fee structure according to your situation. To learn more and get started, contact our Non-compete lawyers to schedule a consultation.