Clear legal agreements help minimize the chances of litigation, which can quickly exhaust the company’s monetary resources and distract it from what really matters – building a business. These agreements also help attract investors.
The courts around the country seem to agree that the more “passive” the social media activity is, the less likely it is to constitute a prohibited solicitation of customers or employees, and the more “active” the posts are or the more akin they are to oral solicitations, the more likely they are to violate non-solicitation prohibitions. In this post, I take a closer look at the various decisions from across the country and synthesize common themes.
The Fifth Circuit Court of Appeals recently considered whether a travel agency’s noncompete agreement with its employee was enforceable under Texas law. It concluded that because the agreement did not have geographic limits, was not limited to the travel agency’s customers with whom the employee actually worked during her employment, and included entire travel agency industry, the non-compete was unenforceable.
The financial services industry has its own set of rules when it comes to enforcement of non-solicitation agreements. In 2004, a handful of the largest financial firms signed a document called Protocol for Broker Recruiting. Since then, over a 1,000 firms became signatories to the Protocol, agreeing to abide by the rules that are meant to curtail non-solicitation litigation among competing firms.
The Department of Justice (DOJ) and Federal Trade Commission (FTC) recently issued Antitrust Guidance for HR Professionals (“Guidance”) intended to alert professionals involved in hiring and compensation decisions
California and Texas differ in many respects, including how they treat non-compete agreements. While Texas enforces non-compete restraints that are reasonable, California has declared such