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Non-Competition Agreements

A non-competition agreement in Houston, also known as a covenant not to compete, non-compete agreement, non-solicitation agreement, confidentiality agreement, or noncompete agreement, is basically created by employers for the purpose of restricting their employees’ activities after the leave the company. For example, an employer may prevent the employee from:

  • Working in the same profession,
  • Soliciting the company’s clients,
  • Hiring former employees, or
  • Using company trade secrets.

If you have a non-competition agreement your employer has asked you to sign or you want to create a non-competition agreement for your employees to sign, it is important to hire an experienced business law attorney in Houston to help you review or draft the non-compete agreement in your particular situation.

Houston Noncompete Agreement Attorney

If you have been asked to sign a noncompete agreement or want to create a non-compete agreement for your employees in Houston, or any of the surrounding areas in Texas, including Spring, Humble, Tomball, Aldine, Atascocita, Klein, Jersey Village, The Woodlands, Conroe or Oak Ridge North, contact the law offices of Wilhite & Associates, P.C. The attorneys at Wilhite & Associates are experienced in creating and reviewing all business legal documents and will help you create the best non-competition agreement for you company. Call Wilhite & Associates at (281) 537-2171 about drafting non-compete agreements for your business.

Houston Non-Compete Agreements

A covenant not to compete in Houston is an agreement an employee makes that they will not compete with their employer. The employee usually signs the agreement prior to or during the course of employment for some form of consideration. The employee then promises in the agreement not to work for a direct competitor or create a company that is a direct competitor within a certain time period and/or distance after leaving the company.

In general, a non-competition agreement must be created based on a legitimate business purpose. For example, the employer must have an actual trade secret they are trying to protect, client base they want to retain, or other business information they want to keep confidential. The agreement cannot be created simply to penalize the employee for leaving the company.

An employer must also provide the employee with some benefit for agreeing to sign the non-competition agreement. These benefits, or consideration, can include a bonus, stock options, a pay raise, or if a new employee, the job position.

Benefits of Noncompete Agreements in Houston

A convent not to compete in Texas can provide employers with an ability retain employees for longer periods of time. Additionally, these types of agreements can protect the company’s confidential information and trade secrets. Further, these types of competitions can prevent a former employee from taking the employer’s private information and using it to their advantage, either to create their own business within an immediate vicinity of their former employer, or to take to another business that is direct competition to their former employer.

Trade secrets and confidential information can contain a wide variety of information a company may want to keep private. For example, this can include recipes, programs, formulas, patterns, methods, techniques or processes that are specific to the benefit of a business or company.

Since many Texas courts may determine a covenant not to compete is not enforceable, it is important to consult with an experienced business lawyer in Houston to help you create a non-competition agreement for your particular business.

Enforceability of Non-Competition Agreements in Houston

Texas law has recently changed laws surrounding non-compete agreements. In 2011, The Texas Supreme Court made a decision drastically different from precedent regarding the enforceability of non-competition agreements in the case of Marsh USA Inc. v. Cook. In this decision, the Court held that stock options were sufficient consideration to enforce a non-competition clause. Prior to this decision, any covenant not to compete was only valid if, as consideration not to compete, the employer had provided the employee with confidential information and specialized training. Therefore, courts in Texas will now enforce non-competition agreements for almost any type of consideration.

Although non-compete agreements aren’t generally favorably looked upon in Texas, the courts will enforce a non-competition clause that was executed for consideration (or something that was given in return), contains reasonable geographic, time and activity restrictions, and protects the employer’s legitimate business interests.

Under the Tex. Bus. & Com. Code § 15.50, a covenant not to compete is enforceable if:

  • It is supplemental to or part of an otherwise enforceable agreement; and
  • It is reasonable in regards to the geographical, time and activity restrictions.

The court will disfavor and not enforce anything that is too broad and not specific as to the restricted time period, the activities the former employees is permitted to engage in, and the distance the former employee is restricted from engaging in the same type of business practices.

The court will probably enforce a covenant not to compete that is only for a one-year period, within the same market as the former employer and only limits a specific portion of the business. The courts will probably not enforce a non-competition agreement that prohibits the employee from working in the same field of business for the rest of their life throughout the nation. There is a lot of gray-area in non-competition agreements that the courts may or may not enforce. Therefore, it is essential to hire an experienced business lawyer who will help you create a noncompete agreement that will be beneficial to your business.

Wilhite & Associates, P.C. | Houston Non-Competition Agreement Lawyer

Contact Wilhite & Associates, P.C. today for a consultation about creating a legal non-competition agreement in Harris County in Texas. Attorney C. Wilhite Law of Wilhite & Associates is an experienced Houston business lawyer who will strategically draft your ideal noncompete agreement or review a non-compete agreement you have been asked to sign by your employer. Contact Wilhite & Associates, P.C. at (281) 537-2171 for a consultation about reviewing or creating your non-competition agreement throughout Harris County, and the surrounding areas of Montgomery County, Washington County, Grimes County, Fort Bend County and Waller County.

Wilhite & Associates, P.C. represents clients from all over Southeast Texas, including:

Harris County - Aldine, Atascocita, Barrett, Barker, Baytown, Bellaire, Brownwood, Bunker Hill Village, Channelview, Clear Lake, Cloverleaf, Crosby, Cypress, Deer Park, East Houston, El Lago, Galena Park, Hedwig Village, Highlands, Hilshire Village, Houston, Hudson, Humble, Hunters Creek Village, Jacinto City, Jersey Village, Katy, Kingwood, Klein, La Porte, Louetta, Lynchburg, Nassau Bay, North Houston, Pasadena, Piney Point Village, Seabrook, Sheldon, Shoreacres, South Houston, Southside Place, Spring, Spring Valley, Taylor Lake Village, Tomball, Webster, West University Place

Montgomery County - Conroe, Cut and Shoot, Magnolia, Montgomery, Oak Ridge North, Panorama Village, Patton Village, Roman Forest, Shenandoah, Splendora, Stagecoach, Willis, Woodbranch, Woodloch, The Woodlands

Fort Bend County - Arcola, Beasley, Fairchilds, Fulshear, Kendleton, Meadows Place, Missouri City, Needville, Orchard, Pleak, Richmond, Rosenberg, Simonton, Stafford, Sugar Land, Thompsons

Waller County - Brookshire, Hempstead, Pattison, Pine Island, Prairie View, Waller

Grimes County - Anderson, Bedias, Iola, Navasota, Todd Mission

Washington County - Brenham, Burton, Chappell Hill

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