#1: Employers can’t enforce non-competes when they terminated the employee.
Wrong – Assuming the non-compete satisfies Texas law, it can survive termination or resignation. Most agreements will spell this out in the agreement, some do not. (Now of course this also assumes the firing was legal, i.e., not based on race, national origin, gender, etc.)
This makes sense in most cases. What if there is an employee who purposely gets fired so they can go out and compete – it happens. Should the employer be penalized because they fired the employee – no. Now, what about a situation where the employer merely fires the employee to gain some tactical advantage in the marketplace and then enforces the non-compete? A judge asked to enforce a non-compete on facts like that may have a different view on enforcing the non-compete in the context of a temporary restraining order and injunction.
The balance of non-compete cases are resolved early on, either through a TRO or injunction. TROs and injunctions force the parties to: (1) spend significant fees early on in the process; (2) get in front of the judge; and (3) negotiate. Parties looking to defend or enforce a non-compete should be considering what the optics will look like to the Court in the context of injunctive relief – usually a situation where the employer is attempting to keep the employee from working for a new employer.
