In Texas, state law prohibits most restrictions on competition, but carves out a limited exception for employee non-compete agreements in statutory law pursuant to the Covenant Not to Compete Act. Non-compete agreements in Texas are therefore generally enforceable if they meet certain criteria under the Act.
Non-compete agreements are challenging contracts that can quite easily be rendered invalid on the basis of persuasive advocacy in which the agreement is interpreted in such a way to be deemed unreasonable. As such, experienced representation is critical to success in both drafting an enforceable agreement and in litigating a favorable result for our clients.
Enforceability of Non-Compete Agreements
Texas law imposes various requirements on non-compete agreements that render them enforceable. The critical requirement, however, is that of “reasonableness.” A reasonable non-compete agreement is one that contains limitations as to time, geographical area, and scope of activity restriction such that the non-compete restriction is no greater than necessary to protect the business interests of the employer.
Whether the restrictions imposed by a non-compete agreement are reasonable is a question of fact that depends largely on the circumstances surrounding the particular employment arrangement. At Berg Plummer Johnson & Raval, LLP, our employment attorneys are experienced in drafting non-compete agreements that are unambiguous and reasonable. When disputes arise, our comprehensive experience in drafting non-compete agreements and litigating non-compete disputes gives us an edge in advocating persuasively for our clients, whether we are representing an employer attempting to restrict the activity of their former employee, or representing an employee attempting to invalidate a non-compete agreement on the basis of it being unreasonable.
When considering the “reasonableness” of a non-compete agreement’s restrictions, such as the duration of the restriction, the geographical scope of the restrictive covenant, and the scope of the activities that are restricted, there are no absolute rules. In one case, a six-month restriction may be deemed unreasonable, whereas in another case, a two-year restriction may be deemed reasonable and enforceable.
Here at Berg Plummer Johnson & Raval, LLP, our Houston employment lawyers understand the unique challenges that arise from the employer-employee relationship and are equipped to provide both transactional counsel and litigation services in the event of a dispute. In the larger employment law context, however, cost-effective representation is critical to a successful engagement. To that end, we work with clients to provide customized fee arrangements that take into account the particular needs, objectives, and budget of each client.
Berg Plummer Johnson & Raval, LLP represents both employees and employers in the negotiation, drafting, and execution of enforceable non-compete agreements and in litigating non-compete disputes. In the even that a dispute arises, our non-compete attorneys are equipped to handle litigation from beginning-to-end. We have experience successfully resolving disputes through mediation, arbitration, and other alternative dispute resolution methods, but are prepared to litigate a case through trial if need be. Our reputation as aggressive litigators gives our clients a valuable edge during negotiations.