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.
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.
RSS Feed
