Texas Employer Ordered to Pay Healthcare Employee’s Attorney’s Fees in a Non-Compete Dispute

A recent decision from the Thirteenth Court of Appeals in Texas serves as a cautionary tale for Texas employers seeking to enforce their non-compete agreements. In this case, a company that provided surgical assistants to surgical facilities and physicians sued a former employee for breaching his 2-year non-compete covenant, which prohibited him from “in any way” offering his services to any “client institutions or client surgeons” of his former employer.

When Do Employers Enforce Non-Compete Agreements?

Many companies in Texas have non-competition agreements with their employees, but not all companies enforce them.  Some companies will sue the departing employees for violating non-compete agreements, even thought such agreement may not be valid under Texas laws.  Others, will not bother with enforcement even though they have valid agreements on hand.  The reality is that the validity of a non-compete agreement is only one factor in a company’s decision whether to enforce it.

COVID-19 Texas Employer Guide – Are Non-Compete Agreements Still Enforceable?

In Texas, the reason for termination of employment – whether it was for cause, without cause, a layoff, a reduction in force, or any other reason – does not affect the enforceability of a non-compete agreement. Therefore, employers should not assume that non-competition agreements are no longer enforceable and must carefully approach enforcement of such agreements against departing employees as well as the hiring of new employees who may be still bound by non-competition agreements with their former employers. 

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