If you follow the ups and downs of non-competes across the country you’ll note that there is a populist fervor in favor of banning non-competes in some states including Massachusetts. The argument generally goes that non-competes stifle innovation and of course prohibit an employees’ ability to move elsewhere (which is true). California has essentially eliminated employment non-competes and as a tech leader other states argue they should follow California’s lead. The Massachusetts approach has been to propose beefed up trade secret laws, specifically adoption of the uniform trade secrets acts, to keep departing employees from using trade secrets with their new employer. The problem with this approach is what if the employer has an interest worthy of protection (training or something that doesn’t quite rise to the level of a trades secrets -proprietary information).
Texas has not seen the populist fervor against non-competes, yet. It’s just not the hot button issue it may be in other places or something for politicians to focus on – of course that can always change in the next legislative session. The Texas Non-Compete Statue has been in place for many years without any significant changes. I expect that to remain the same. As we have discussed here previously, an enforceable Texas non-compete must be ancillary to an otherwise enforceable agreement and reasonable in time and scope. The same holds true for non-solicitation agreements and anti-raid provisions. In theory it is a very high standard to satisfy the non-compete statute. Of course most non-compete disputes are resolved by a district or county court judge in Texas and never reach the scrutiny of the appellate court. That means we’re talking “rough justice” where the trial judge will attempt to do what is fair.
For now Texas remains pro-employer and this holds true for post-employment covenants as well. There just simply isn’t an anti-non-compete consensus in Texas nor does there to be one on the horizon. So continue to draft away – in compliance with the statute.
