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Do you have a non-compete and wonder, “How can I get around this non-compete?” Wonder no longer. In this article, we discuss how we’ve helped clients in getting around a non-compete.
At Gardner Employment Law, non-compete agreements probably make up the majority of our cases. We have developed strategies to help our clients defeat legally defective non-compete agreements, and we can help you.
What Is the Best Strategy for Getting Around a Non-Compete?
The best strategy to get around a non-compete restriction is to determine that the wording does not comply with the statutory requirements. Section 15.50 of the Texas Business & Commerce Code governs how non-compete agreements must be worded. As that statute requires, there are 4 elements that must be contained within the body of the non-compete provision:
The restrictions must be reasonable in the (1) length of time that the restriction will last; (2) geographical area where the activities may not be performed, and (3) the scope of the activity that cannot be performed. The 4th element is that the restrictions placed upon the departing employee cannot be greater than necessary to protect the employer’s business interests governed by this statute, namely, confidential information and trade secrets of the employer.
If any of these 4 requirements are not met, the non-compete agreement is not enforceable.
How to Get Around a Non-Compete Even if It Contains the Required Wording?
If the wording of the non-compete satisfies the statute, determine whether the facts support the 4 requirements listed in the statute. This requires a detailed analysis and quite a bit of time. If the facts do not show that what happened satisfies these 4 elements, the non-compete is not enforceable.
We send written questions to our clients to collect the facts underlying each of the 4 elements. Generally, we ask about these topics, although the questions are customized to fit the particular client’s situation:
- Based on the time restraint, will you still be able to find a job in your industry when that time is over (if not, why not)?
- Where did you work, in what geographical region, while you were employed by the former company?
- What activities did you or your direct reports perform within that geographical area?
- Can you work in your industry until this non-compete ends?
In most instances where we have prevailed, it is #3 – the scope of the activity being restricted — where we are successful. That is because most companies get greedy and want to prevent the departing employee from doing anything whatsoever with a competing company. For example, many times the employer will draft the non-compete restricting the employee from performing “any” services for a competing company. Texas courts have held that the employee can be restricted from performing only the same types of activities that he performed while employed by the previous company.
The example just stated would violate this law. Taken to its logical extreme, the employee could not work in the mail room, could not sweep floors, could not file papers – could not do “anything” at another company. That restriction also would violate requirement #4 in the statute. The restriction would be more than necessary to protect the confidential information that the employee learned while doing his or her regular job at the former company. Again, this would cause the non-compete agreement to be unenforceable.
We Can Help You Get Around a Non-Compete.
If you are considering leaving your company and you previously signed a non-compete agreement, it may not be enforceable. At Gardner Employment Law, we are glad to take a look at your contract and give you an opinion. Give us a call.