In contract law, a non-compete agreement (also called a non-compete clause or covenants not to compete) is a clause under which one party agrees not to enter into or start a similar trade in competition against another party for a reasonable set period of time and geographic area.
In the employer – employee context, non-compete agreements are legal contracts in which an employee agrees, upon termination or resignation, not to work for a competitor, start a competing business, or abuse their employers confidential information or trade secrets, such as customer lists, business practices, and marketing plans. Essentially, non-Compete agreements protect a business’ “goodwill,” or the value of a business that comes from the synergy between its parts and staff.
Employee rights are also protected under non-competes, as only specific and limited clauses are enforceable. No employer has the right to limit an individual’s business indefinitely and generally speaking, non-competes must be reasonable in their restrictions on time, geographic coverage, and the scope of business activity prohibited to be enforceable.
Similar to non-compete considerations for the employer-employee relationship, as part of the sale of a business or merger and acquisition, obtaining an effective non-compete agreement from the seller is by and large a critical component in protecting the buyer’s post-closing business interests. A seller non-compete agreement can help prevent the seller of the business from starting a competing business for a certain period of time after the transaction closes (that is reasonable in duration and geographical scope). A covenant by the seller not to compete is typically included in the purchase and sale agreement of the transaction.
Our Houston business law firm, Hendershot, Cannon & Hisey, P.C., works with employers, executives and employees, as well as buyers or sellers of a business, to help effectively draft, review, negotiate, and implement non-compete agreements that are detailed, reasonable in scope and duration, enforceable, and mutually agreeable. In addition, our business law attorneys can assist clients in defending against non-competes in a wide variety of issues, including:
For prompt attention to your non-competition concerns, beginning with a confidential consultation, please call our Houston business law firm (713) 909-7323 or complete an online form. We welcome client inquiries and referrals from throughout Houston and the state of Texas.
Physicians and healthcare entities are bound by different non-compete restrictions than other industries. In general, a non-compete must be "reasonable," both in geographic area, scope of practice, and the time that it is enforceable. For healthcare professionals, this means your non-compete clause must meet the following standards:
Good non-competes are in the interest of the physician, the hospital, and the public. A well-drafted agreement will allow a hospital to protect its future security without denying physicians the ability to make a living or denying patients the ability to receive the best-quality care available to them. At Hendershot, Cannon & Hisey, P.C., our Houston business law attorneys are highly experienced in drafting, reviewing and negotiating non-compete agreements for physicians, medical professionals and hospitals.
Like all other legal contracts, non-compete agreements should be entered into with clarity surrounding what they allow and what they prohibit. Companies that use outdated or improperly drafted agreements sometimes suffer severe financial repercussions when they turn out to be unenforceable. Your legal rights may hinge on nuanced aspects of the contract and considerations specific to your industry, as well as how the court views the necessity of specific restrictions for protecting the employer's business interests and goodwill.
At Hendershot, Cannon & Hisey, P.C., our Houston business law attorneys offer highly informed, reliable counsel for businesses focused on protecting their proprietary information, strategic plans, and client relationships. Our lawyers are equally adept at reviewing all types of contracts on behalf of individuals whose professional options and futures hang in the balance.
Fair, enforceable contracts offer protections to both parties that enter them, and we are intensely dedicated to ensuring that our clients' interests are protected. Our Houston law firm has been providing proven solutions since 1987! If you have questions about the language of your non-compete agreement, or need to draft or enforce one, call our legal team today to draw from more than two decades of experience.
To schedule a confidential consultation, call (713) 909-7323 or contact us online.