When you run a business, there is likely a significant amount of information you want to keep to yourself. This may include plans for products or operations, compensation packages, client lists, operational guidelines, and more. When people work for you, it is often necessary for them to learn about much of this sensitive information to adequately perform their job duties.
Business owners turn to The Weisblatt Law Firm for top-shelf representation in challenging business matters.
Having employees who have access to or knowledge of important information can be troublesome if they suddenly go to work for a competing company. This can put your proprietary information in the hands of your direct competitors, which can take away your edge or be used against your company.
To avoid this scenario, many employers want individuals who start working for them to sign a non-compete agreement, which is often included in a larger employment agreement. The non-compete provision generally prohibits a former employee from working for competition in a certain geographical range for a certain period of time after the employment relationship ends.
To speak with an experienced Texas business lawyer, don’t hesitate to call The Weisblatt Law Firm. Learn how Attorney Weisblatt can assist you with your affairs relating to non-compete agreements. Call (713) 666-1981 today.
While non-compete agreements are intended to protect the interests of a company, many courts will not enforce these agreements if they cause unreasonable restrictions or harm to the employee. The scope of the restrictions needs to be reasonably necessary to protect your information and may not cause undue harm to the public or to the employee. If a court finds an agreement is too broad or too restrictive for an employee, it may throw out the whole agreement and leave your company vulnerable.
To ensure that your non-compete meets the proper standards, you should have it drafted and reviewed by a skilled business lawyer who understands non-compete laws in Texas. If an employee brings a legal claim regarding a non-compete, you should also seek legal representation as soon as possible.
Crucial Elements of a Non-Compete Agreement
Proper planning and drafting are essential to a successful non-compete agreement. An experienced business attorney is capable of ensuring that your non-compete agreement is drafted in a way that protects your business interests and withstands legal scrutiny in the event of a conflict.
Tailored Language
Non-compete agreements are standard agreements in many industries. However, each non-compete situation is different. The language contained in non-compete agreements must be tailored specifically to the industry and circumstances of the parties. Texas courts are loath to enforce cookie-cutter non-compete agreements.
Additionally, tailored language provides the appropriate level of protection by addressing specific material details of the circumstances. For example, a non-compete for an executive employee should be markedly different in certain aspects from a non-compete drafted for an entry-level employee. An experienced business lawyer will take the necessary steps to produce a proper non-compete agreement for your needs.
Consideration
Non-competes are not enforceable if they do not provide consideration. Consideration is something of value in exchange for the agreement to not compete, such as an initial offer of employment, a pay raise, stock options, or a promotion.
Reasonable Scope
Non-competes allow businesses to restrict the business activities of others, but only if the restrictions are reasonable. For example, a non-compete that completely and indefinitely limits another’s right to compete is simply not allowed, because it would not be reasonable.
When determining whether a non-compete agreement is valid, the courts will look at the nature of the restriction and its terms. Common restrictions in non-competes include restrictions on:
- Geography
- Industry
- Time.
Geographical restrictions may prohibit a person from working in the same state or region. However, these restrictions are unreasonable if they cover too much area. For example, an agreement restricting a person from competing anywhere in the world would not stand up to legal scrutiny.
Regarding restrictions related to an industry, a party may be prohibited from working for a competitor, but not usually barred from an industry altogether. And time restrictions may not extend to unreasonable lengths into the future.
Legitimate Business Interests
Non-competes are meant to serve only one purpose: to protect the legitimate business interests of a company. Without a legitimate business interest, a non-compete may not be legally utilized. The courts require that non-competes contain specific identifiable interests that are at risk without the use of a non-compete.
In every case, your non-compete concerns should be addressed by an experienced business law attorney. Your business is valuable, and you have the right to protect yourself by reasonably curtailing the competitive efforts of those who are privy to the secrets and methods of your business.
A Texas Business Law Attorney Can Address Your Questions and Concerns
Many company owners wonder how to handle sensitive information and non-compete agreements. The first step in solving your legal problems is to consult with a business lawyer at The Weisblatt Law Firm in Houston. Our office has helped many companies with employment issues, business contracts, business litigation, and more.
To schedule a consultation with our team, simply give us a call at (713) 666-1981. We’ll listen carefully to your concerns and create solutions that work. Contact our office today!
Attorney Andrew Weisblatt
Mr. Weisblatt has practiced continuously since becoming licensed in 1992 and has represented businesses ranging in size from one person start-up ventures to multi-national corporations employing hundreds of people in multiple countries. From 2005 through 2009 Mr. Weisblatt was in-house counsel and chief operating officer of a multi-national corporation in the steel products industry. That in-house position provided valuable insight into how businesses work and what they actually need from their lawyers – both in-house and outside counsel. Attorney Bio
