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Are noncompete agreements legitimate in Texas?

by on
in Employment Law,Human Resources

Q. Can noncompetition agreements be enforced against at-will employees in Texas?

Yes, if the agreement is carefully drafted. A noncompete agreement must be ancillary to an otherwise enforceable agreement. The agreement must also be reasonable with respect to the duration, scope and geographical limitations placed on the employee.

For the agreement to be enforceable, you must provide the employee with independent consideration in exchange for the commitment to refrain from competing. The covenant must be designed to enforce the worker’s promises and to protect your legitimate business interests.

You can include noncompete covenants (with appropriate limitation and supported by independent consideration) into a confidentiality agreement in which you agree to provide confidential or proprietary information in exchange for the employee’s agreement not to disclose the information during or following employment.

Texas courts have held that properly drafted noncompetition covenants are ancillary to or part of such a confidentiality agreement.

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