TEXAS: NON-COMPETE LAW The Law Office of Raven Applebaum, PLLC

Raven Applebaum  Board Certified in Labor and Employment Law  Outside and in-house counsel  Both sides of the bar

Non-Competes: Get Used To Them  Texas Supreme Court has dramatically broaden the enforceability of non-competes  Much easier for employers to have non-compete and for them to be up-held

Non-Compete Agreements  In Texas, non-competition agreements are governed by Section 15.50(a) of the Texas Business & Commerce Code, which states that “a covenant not to compete is enforceable if it is ancillary to or part of an otherwise enforceable agreement at the time the agreement is made to the extent that it contains limitations as to time, geographical area, and scope of activity to be restrained that are reasonable and do not impose a greater restraint than is necessary to protect the goodwill or other business interest of the promisee.”Section 15.50(a) of the Texas Business & Commerce Code

Factors To Enforce A Non-Compete  Thus, Texas courts require two factors to enforce a non-compete agreement that is ancillary to an otherwise enforceable agreement:  1. There must be consideration. Often in times for exchange of confidential information Stock options for promise not to compete Not just for employment  2. The limitations on time, geographical area, and scope of activity to be restrained must be reasonable.

Top Non-Compete Questions  When is a non-compete agreement enforceable?

Top Non-Compete Questions  How long can an employer stop an employee from competing?  What is the Statute of Limitations for an employer to sue on a breach of non-compete agreement?  I don’t have a non-compete. Can my former employer still restrain me from competing?

Top Non-Compete Questions  What can I take, or more importantly – not take, when leaving employment?  What should I tell my employer upon resignation if I have a non-compete?  Should I tell my new employer I have a non- compete agreement?

Top Non-Compete Questions  Are non- solicitation/employee recruitment clauses enforceable?

Top Non-Compete Questions  Can an employer enforce an overly-broad non- compete?  Court can reform “blue pencil”  Doesn’t get you out of if it  Do I need an attorney to help understand the Texas non-compete process?

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