Texas Non-Compete Law: Confidentiality, Just Like Beauty, Is In the Eye of the Beholder

In non-compete disputes in Texas, employers often argue that everything that they provided to employees was confidential, while employees argue that nothing that was provided to them was confidential. As the result, the issue of confidentiality often ends up being an ultimate “fact issue” that must be resolved by a judge or a jury.

What Employment Bills Will Texas Legislature Consider in 2021?

In 2021, the Texas legislature will consider employment law bills that will: expand employment discrimination to include gender identity and expression, require paid sick leave; prohibit inquiries into wage history or criminal background (prior to offer of employment); require advanced notice of work schedules in food and retail establishments; prohibit non-disclosure and arbitration contracts in sexual harassment disputes, and raise minimum wage, among others.

A Texas Staffing Agency Ex-Owner Indicted, Faces 15 Years in Prison for Wage Fixing for Employees

Wage-fixing, i.e., agreeing with competitors that everyone will pay the same wage or will not pay more than a pre-agreed amount, is illegal. Just as companies can’t get together and fix prices for goods, they are also prohibited from fixing prices for services. A recent indictment of a Texas ex-owner of a staffing agency alleging that he engaged in price fixing shows that DOJ and FBI take wage-fixing arrangement seriously. The indicted ex-owner now faces up to 15 years in prison and over a million dollars in fines.

Are Courts Actually Enforcing Non-Compete Agreements During the Pandemic?

While the enforcement of non-compete agreements around the country remains strong, the courts are looking closer at whether an employee will suffer “undue hardship” if his or her non-compete is enforced. Thus, employers should avoid taking unreasonable positions in court and be prepared to explain why enforcing a particular non-competition agreement will not prevent an employee from earning a living.

Non-Compete Agreements Related to a Sale of Business

In Texas, a 5 to 10 year non-compete agreement related to a sale of business is the norm. n addition to the non-compete restrictions in the sale documents, those sellers who stay employed by the buyer after the sale often sign a second non-compete agreement as part of their employment package, which does not kick in until after their employment with the buyer terminates.

1 2 3 4 5 27