We get a number of calls from employees who are negotiating new positions or who are already employed and are asked to sign non-compete agreements.  Smart employees negotiate the agreement on the front-end, preferably with the help of an attorney who either stays in the background or actually does the negotiating, depending on the employee's seniority level with the new/existing employer. (Employers will not be surprised to hear from a high-level executive's attorney regarding a proposed non-compete and other negotiable pre-employment issues.)

Often employees bring us non-compete agreements with arguably overly broad terms that may not be enforced by a Texas court or arbitrator.  We always recommend that employees not sign a non-compete agreement thinking that it will be deemed unenforceable.  One reason for this is that Texas law regarding non-compete agreements frequently changes.  An agreement that is not enforceable today may be in the future.  Another reason is that a Texas court can reform the non-compete agreement to make it reasonable.  It is better to negotiate reasonable geographic and time limits in advance and preferably while the employer and employee are in the honeymoon phase.  Even if the non-compete should be considered overly broad and therefore unenforceable (absent reformation), do you really want to be required to present it to your next employer and/or have the new employer threatened with a lawsuit?  Most employers want their agreements to be enforceable; if a knowledgeable attorney explains to them the issues with their non-compete agreement, they are typically open to revising, which is in everyone's best interest.  

Employees who are starting employment have more leverage than those currently employed who are asked to sign non-compete agreements.  In some cases employees have reported to us that they have been threatened with their jobs if they don't sign and not allowed to negotiate the non-compete agreement at all. Depending on how unreasonable the non-compete agreement is, these employees sometimes consider making a job change, particularly if they were already considering a change and if the non-compete would keep them from working in their field for a number of years.  Even if the employer will not negotiate the non-compete, it is helpful and worthwhile to discuss the enforceability of lack thereof with an attorney prior to signature.  Many quality employment attorneys in Dallas offer a flat-fee review of non-compete agreements or offer a retainer and reasonable hourly rate for cases in which negotiation with the employer is desirable.

We get this question frequently so I thought I might address it here.  Often, employees assume that there is a cause of action called "wrongful termination" and that if the employer does not have good cause to terminate then the employee should not have been fired.  If only that were the law.  Unfortunately for employees, absent an employment contract, a termination is only "wrongful" in a meaningful legal sense if the employee is terminated for an illegal reason, such as age, race, disability, gender, pregnancy, etc. or for opposing or complaining of discrimination, complaining about unpaid overtime, for using FMLA leave, or for refusing to commit criminal acts (in Texas--many states have better whistleblower protection).  This is not an exhaustive list but hits on the most common illegal reasons for terminating an employee.  

Employees who believe they have been wrongfully terminated would do well to give deep thought to what really caused their termination.  We tend to ask employees, "What do you think is the real reason for your termination?"  When the real reason in the employee's heart of hearts is discrimination or retaliation, we are more interested in taking the case.  When the real reason is "the supervisor never liked me," "the supervisor wanted to bring in his/her favorite past employee/friend/son/daughter," "the employer mistakenly believed I did something wrong," etc., we are less likely to be interested in the case.

Often, employees who are racial minorities or who have disabilities want to believe very strongly that they have not been discriminated against, and they tend to turn a blind eye when discrimination is staring them in the face.  This is completely understandable, but it is helpful to speak to a high-quality employment attorney to explore questions such as whether white employees were treated the same as African American employees in discipline, for example, or whether the employer just assumed that an employee with cancer or another disability could no longer do his or her job.  In other words, comparing with employees not in the protected category tends to tease out hidden discrimination.  It is also helpful to discuss with an attorney whether there are issues regarding unpaid overtime.  Even if the employee does not have a cause of action regarding the termination, an employment attorney may be able to assist with getting the employee's unpaid overtime and penalties.

Often employees will have very little notice when they are being severed from their positions.  One day they are happily going about their jobs, and the next they are presented a severance agreement and sometimes even walked out of the building (and cut off from email) without being given the chance to say goodbye to their long-time colleagues and friends.  For many employees, they have served years and even decades in their positions, and they leave the employer with their heads spinning and unsure what to do.  

Dealing with the severance agreement often takes a back burner to dealing with the immediate emotional and financial issues facing any employee who loses a job.  This is completely understandable, but employees should be aware that they will typically have just 21 days to review the severance agreement.  In some cases, the employee may have only a few days to review (this is allowed when the employee is under 40), and in some cases the employee will have more time (45 days), such as when releases are sought from multiple employees.  In any case, it is best to get a review of the severance agreement earlier rather than later so that an attorney will have time to evaluate and assist if needed.

Employees will typically be waiving the majority, if not all, of their rights by signing the severance agreement.  In some cases, unemployment compensation and workers' compensation claims will be carved out of the agreement.  While most employees read and take seriously the severance agreement's advice to consult an attorney, on occasion, we talk with employees who for some reason believed that they could sign the severance agreement and still sue the employer for discrimination or other unfair termination.  In most cases this will not be possible.

Employees who are fired or laid off should discuss their options with a reputable employment law attorney to explore whether the termination or layoff was due to unlawful factors, such as age, race, disability, gender, pregnancy, protected leave, or retaliation for complaining of discrimination or unlawful behavior on the part of their employer, among other unlawful reasons.  If so, the attorney will likely have leverage to negotiate a greater severance amount for the employee.  Even without discrimination or other legally protected activity, a skilled attorney may be able to get additional severance for an employee, especially if the employee was highly valued at his or her place of employment and if the powers-that-be felt badly about the separation.

In addition to having an attorney assist with negotiating the actual severance amount, it is wise to understand and negotiate the non-economic terms of the severance agreement.  For instance, what happens if an employee accidentally tells someone about the severance?  (In most cases, they will have to pay the severance amount back to the employer and may even be liable for the employer's attorney's fees in collecting.)  Does the severance agreement contain an additional non-compete, and is that non-compete enforceable?  What will the employer tell prospective employers about the separated employee and reason for separation?  Will the employer agree not to contest unemployment benefits?  Will the employer agree to waive enforcement of a prior-existing non-compete as part of the severance?  In some cases these "non-economic" considerations have more actual economic impact than the severance amount itself.

I personally have never encountered a client who was sorry that they had an attorney assist them with negotiating a severance agreement.  In a few rare cases the amount offered will be high enough that the employee will accept the offer without negotiating, but even in those cases (and probably especially in those cases, since more is at stake) it is wise to have an employment attorney review the severance agreement to ensure that all is in order.  Many local attorneys can offer a severance review for a reasonable flat fee and can offer negotiations with the employer for a reasonable hourly rate and retainer.  In some cases, where the facts are particularly egregious, the employment attorney may be able to take the case on contingency so that the employee does not have to pay out-of-pocket.