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Can a former employer hold me responsible for a non-compete / non-solicit agreement that does not exist?

Dallas, TX |

I am interested in hiring a couple of former employees. My former employer has sent me a letter threatening to sue me for not living up to my end of the agreement. The so-called agreement was written into a clause in the employment agreement, but for whatever reason, when I was hired, this document was never part of my new-hire paperwork, meaning there never was an agreement between myself and my former employer.

Attorney Answers 4

Posted

Under Texas law, if you did not sign a non-solicitation agreement, you are perfectly free to solicit your former employer's current employees. This assumes, of course, that the current employees at at-will employees and do not have non-compete obligations. Otherwise, they are fair game under Texas law.

You need to be aware of confidentiality and trade secrets issues, of course, but that does not stop you from hiring the employees if they are not subject to non-competes and you are not subject to a non-solicitation covenant.

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2 comments

Asker

Posted

Mr. Holmes, Thank you very much for the response. The agreement that binds the employees in question are admin employees and like myself was never privy to trade secrets or anything that would harm the business. These employees are bound by the agreement that reflects they cannot hire or solicit other employees away nor compete against their current employer. My business is totally different industry from my former employer. I was contacted by my former employer's attorney reminding me of my obligations and was given a deadline to confirm in writing that I have had not contact with the employees. By email, I requested a copy of the agreement twice prior to the deadline which was yeterday. I emailed the attorney today stating that since I have not received a response to my two previous requests that I was going to assume that I received the letter by mistake and that I was going to conclude that the alledged obligations were invalid and unenforceable. I asked him to confirm this matter was closed. The attorney responded stating that "assumptions are dangerous" and that "I would hear from him again in the future when he was ready." Is there a way to legally close the book on this matter considering he and his client failed to provide me with the alledged agreement between me and my former employer? Thanks again for your assistance.

David C. Holmes

David C. Holmes

Posted

You could sue for a declaratory judgment that you can hire their employees, but that would be expensive. Otherwise, there is no way to get neat closure.

Posted

Even without an agreement defining your duties post employment, you still owe the former employer duties to not take their confidential information. You also owe a duty to not interfere with the former employer's contractual expectations with its employees.

You should not target your former employees. You can advertise for open positions and should seek to attract all interested people. You should make all offers of employment in writing and confirm that they are bringing nothing with them from the prior employer. You also want the prospective employees to represent that they are not restricted by any written agreements.

You should review the recruiting plan with corporate counsel to prepare to defend the entity from civil liability later.

If you find an answer helpful please mark it as such or as the Best Answer. You have asked us to state an opinion based upon stated facts. You have not provided us with any documents, pictures, witness statements or other admissible evidence. The opinions stated are based upon general principles of law unless otherwise stated, which may or may not be applicable in your jurisdiction. Controlling law is also subject to change or reversal at any time. Any such changes may be retroactive and could significantly modify the statements and opinions expressed herein. Similarly, any change in the facts and assumptions upon which this opinion is based could modify the conclusions. We opine only as to matters expressly set forth, no opinions should be inferred as to other matters or to treatment of matters not specifically addressed. This opinion represents our best judgment as to the probable outcome of the issues discussed and is not binding on the courts or upon your adversaries. We can give no assurance that an adversary would not challenge our conclusions and prevail in the courts in a manner to cause adverse consequences. With respect to some of the matters discussed in the opinion, existing legal precedent may provide very little legal guidance. Although the opinions and views expressed are based on our best interpretations of existing law and what we believe a court would probably conclude if presented with the applicable issues, we can give no assurance that our interpretations would be followed if the issues became the subject of judicial or administrative proceedings. Realization of certain benefits described is subject to the risk that someone may challenge the treatment and that a court may sustain the challenge. Because you may bear the burden of proof required to establish a fact, the opinions expressed assume the you will undertake the effort and expense to present fully the case in support of any matter that you have asserted and an opponent might challenge. None of the advice provided here may be used to avoid tax liability, interest or penalties. If you want that level of assurance you will need employ us to perform the due diligence necessary to explore the facts and law applicable to your specific circumstances. I provide answers here to allow people to see the issue spotting, solution proposals, style of communication and analysis I may apply to factual statements.

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Posted

He may not realize that he does not have an actual agreement. Therefore, the first step I would take is to ask him for a copy of the agreement to which he refers. If he is unable to produce it, then you are free to hire anyone you want. I think it would send a much stronger message for that letter to come from a lawyer, and giving him a specific number of days to respond. My firm can help you draft such a responsive letter. There are other issues, and steps you will want to take to better insulate you and your company from liability. Give me a call if you would like representation in this matter. My number is 972-702-6061. We handle all small business issues, including employment and noncompetes (whether they exist or not).

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1 comment

Brent Andrew Money

Brent Andrew Money

Posted

Great advice to ask them in writing to produce the agreement. If he ever takes legal action against you for soliciting employees, a properly-written letter where you asked for a copy of the agreement he claims you signed together with proof that he didn't provide it, should be the foundation for a strong defense.

Posted

I agree with Mr. Walker's admonitions to you. The first step is to confirm what you signed and what, if any, agreements those employees signed. Non-solicitation agreements are enforceable in Texas. Additionally, you and those employees are bound by Texas law not to use a former employer's confidential information. You may be sued for tortious interference with your former employer's employment contracts and for misappropriation of their trade secrets. This type of litigation is costly. You should consider that cost versus what these hires will bring to your business. If the rewards are that great, then you need to consult a lawyer to paper your trail and reduce the risk of such litigation being successful against you. I am more than happy to discuss with you your situation to determine the best way for you to proceed. 713-752-8656

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