Understanding Non-Compete Agreements in Texas

Hello there, tech-savvy entrepreneurs! If you’re not already familiar with what a non-compete agreement is, let me break it down quickly. This legal document can limit you, the contractor, from becoming employed at a competitor of your former employer for a certain window of time, in a particular location. It may be associated with an employment contract, but doesn’t always have to be.

When placing job ads to hire contractors via LeanKit or other recruiting platforms, non-compete clauses are often ignored for the sake of convenience. After all, they aren’t always legally enforceable. It seems like a whole lot of unnecessary fuss when you’re just trying to get the job done.

However, dodging this issue can really come back to bite you, and in fact, can hurt your business much more so than enforcing it. In addition, as I said before, these provisions are often very simple and straightforward, so it can be easy to work around them when hiring via a marketplace app like Bench Direct.

As the law varies from state to state, this article will look into how Texas law on non-compete agreements affects your chances of getting your job done. Although some may claim that non-compete clauses are unethical practices, the truth is that you’ll need to understand the full extent of these agreements if you want to properly and efficiently hire contractors on a marketplace app like Bench Direct.

So how does this exactly help you? Well, as it turns out, Texas has one of the most “fair” state laws on non-compete agreements in the United States. As long as the contract contains the required elements, a non-compete clause in this state is valid and enforceable in a court of law.

For your convenience, I’m going to quickly buddy up with you-by the end of this article, we’ll both be non-competing, nor in this for the money or for cheap thrills. Let’s dive into the legal framework beneath non-compete agreements in Texas, and how you can make money with your next contract without wading through the legal bureaucracy.

Generally speaking, these contracts must be reasonable in their time and area restraints, and must be tied into a business interest. In other words, Texas law on non-compete agreements requires these clauses to be directly related to the business as a whole. For example, if you are a defense contractor, your business interest against competition is broad enough to have a legal basis for a non-compete agreement.

However, if this was not the case-we’ll use a butcher shop as an example-the court may find that a butcher’s business interest is not protected by a non-compete, as a butcher is not “unique”. The business interest of a common butcher is not unique, and thus, cannot stand alone as the primary element of a non-compete.

For your convenience, I’m going to quickly buddy up with you-by the end of this article, we’ll both be non-competing, nor in this for the money or for cheap thrills. Let’s dive into the legal framework beneath non-compete agreements in Texas, and how you can make money with your next contract without wading through the legal bureaucracy.

As far as the consideration element is concerned, it’s quite a good thing to be up to speed on. Essentially, the consideration element of a non-compete agreement states that the document must provide a benefit in exchange for your restriction from working outside of the company where the contract was given to you.

Because it is somewhat ambiguous as to what this “benefit” should be, it’s essential to analyze the details of your contract carefully and to ask the contractor if they are willing to provide additional pay or benefits for you if you comply with the provision. On the other hand, if your benefits under the agreement will fall short or you will be losing too much money or freedom by signing them, it may be more feasible for you to walk away and cut your losses than to move forward.

This all begs the question-how can you avoid having non-compete clauses or strategically navigate around them without getting stuck in a legal lawsuit? Well, there’s a variety of options. I’ve narrowed it down to the five primary ones that I find most effective and practical.

1. Leave the non-compete outside of this contract as if it were never spoken of during the negotiation process.
2. Accept the non-compete and negotiate for higher compensation or benefits.
3. Refuse the non-compete and walk away from the whole deal.
4. Accept the non-compete regardless of the compensation, yet shorten the amount of time required by the contract.
5. Enforce the provision without compromise, because to break it would be illegal.

Breaking the non-compete without negotiating it down first can leave money on the table for you personally, but it can also hurt Bench as a hiring platform, considering that all of the contractors who come through us and net us higher ratings for your individual projects are still our contractors the same. This means our reputation as well as yours is at stake when the non-compete is enforced.