Non-Compete Laws in Texas
Texas enforces non-competes under the Texas Business and Commerce Code if they are ancillary to an otherwise enforceable agreement, supported by consideration, and reasonable in scope, duration, and geography.
Review My Non-CompeteNon-Compete Overview: Texas
Texas enforces non-competes under the Texas Business and Commerce Code if they are ancillary to an otherwise enforceable agreement, supported by consideration, and reasonable in scope, duration, and geography. Courts may reform overly broad non-competes rather than voiding them entirely.
Key Points for Texas
Non-Compete Laws by State
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Frequently Asked Questions
Are non-competes enforceable in Texas?
Yes, if they meet certain requirements: they must be ancillary to an otherwise enforceable agreement, supported by adequate consideration, and reasonable in time, geographic area, and scope of activity. Texas courts can reform non-competes that are too broad rather than voiding them.
How long can a non-compete last in Texas?
Texas law does not set a specific maximum, but courts generally consider 1-2 years reasonable. Non-competes longer than 2 years face greater scrutiny and may be reformed by a court.
What counts as consideration for a Texas non-compete?
Access to confidential information, trade secrets, or specialized training typically qualifies. At-will employment alone is generally not sufficient consideration. Stock options or a signing bonus can also serve as consideration.
Can a Texas court change my non-compete?
Yes. Unlike many states, Texas courts can reform (blue-pencil) non-competes that are too broad. The court may reduce the duration, narrow the geographic scope, or limit the restricted activities rather than voiding the entire agreement.
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