Broad Non-Competition Agreements a Problem

The broader a non-competition agreement is, the more problems there are enforcing it.

“Typically speaking, if you have a really broad non-competition clause in your employment contract with a worker, the less enforceable it is. If however an employee has access to trade secrets, highly confidential company information and gets paid extra money for the non-compete clause, you have a better chance enforcing it in court,” said Seth Wilburn, of the Gomez Law Group, a Dallas employment lawyer and Dallas business lawyer.

In order to be able to actually enforce a non-compete agreement, the employer/company must have a legitimate business interest that needs protecting. This interest needs to be more than just the threat of competition. “It should include proprietary information about the company and/or products, the protection of company trade secrets and insider information on competitive positioning. This insider information may give an employee an unfair advantage,” commented Wilburn.

Having an unfair advantage is about more than just competition and the non-competition agreement. The agreement may come under attack if the worker does not use the actual trade secrets he knows, but just admits to having general knowledge of things he has learned.

The other issue in many non-competition contracts is soliciting customers. Some companies write in a clause in the contract that bans a worker from offering services or contacting customers that are currently with the company. “It’s interesting to note that the courts are more likely to enforce a non-solicitation clause than they are to uphold a no contact or no service clause. The reason for this is that the court regards those two clauses are being anti-trust violations and therefore anti-competitive because it doesn’t give the customer a choice,” Seth Wilburn of the Gomez Law Group, a Dallas employment lawyer and Dallas business lawyer added.

When it comes right down to it, distinguishing between non-solicitation and solicitation is somewhat difficult largely because it is subjective. In some cases it would be obvious if there was solicitation particularly if a phone call or letter were involved. However, advertising in the paper isn’t considered to be solicitation – because it gives consumers a choice.

“If you have questions about a non-competition agreement you signed, specifically if it’s enforceable, talk to a skilled business lawyer to get honest answers,” said Wilburn.

Gomez Law Group is a Dallas employment lawyer and Dallas business lawyer. To learn more, visit “” .

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