Independent Contractor Agreement With Non Compete Clause In Texas
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FAQ
In Texas, a court has the ability to modify – or even nullify – the non-compete if the court determines that it is not reasonable. The courts are given wide latitude to reform a non-compete if the court believes the scope of activity, duration, or geographic area are too restrictive.
Yes, it is legal to include a non-compete clause for independent contractors in Texas contracts. However, the enforceability of such clauses depends on meeting several legal requirements.
Can a company prevent you from working for a competitor Texas? Yes, a company can prevent you from working for a competitor in Texas if you have signed a valid and enforceable non-compete agreement.
compete in Texas is void if it has unreasonable terms, lacks adequate consideration, or doesn't protect legitimate business interests.
You are bound by whatever conditions you agreed to in the non compete contract. You can leave the job and likely still practice in your given field. The most common restriction is one of distance. So you cannot leave your current company and go across the street to work for a competitor.
Under the Noncompete Rule, the FTC adopted a comprehensive ban on new noncompetes with all workers, including senior executives. The final Noncompete Rule provides that it is an unfair method of competition—and therefore a violation of Section 5—for employers to enter into noncompetes with workers.
Texas is a "blue pencil" state. That means that an overbroad non-compete (for example: one that lasts for 10 years, or that has no geographic restrictions) is still enforced.
Workers who use their own materials and tools, control meaningful aspects of the working relationship, complete tasks relatively quickly, are highly skilled, and control how they perform their job can usually be classified as independent contractors.
The court held that the FTC had improperly exceeded its statutory authority by creating a substantive Rule banning non-competes. The court also concluded that the Rule was arbitrary and capricious, in violation of the Administrative Procedure Act.
