I started working at a bakery retail store last week and they made me sign a Non compete/ disclosure covenant to start. I am not making end's meet (7.25/hr) when I have my student loans, car/insurance payments, credit cards, etc to pay off so I wanted to get another part time job. I graduated with an Associates of Occupational Studies in Baking and Pastry, specifically; so naturally that's what I'm looking to do. This covenant states that I cannot work for any "competition" within 10 miles of ANY of their locations. There are 5 of them within the 50 mile radius around me so I'd have to go 60 miles away to work. It's stopping me from working in my trade if I'm ONLY work as a sales associate there and I want to work in the bakery aspect of another retail store. Is this enforceable?
Employee Benefits Lawyer
In Texas, covenants not to compete are governed by Texas Business & Commerce Code §15.50. I have included a link to the BCC §15 below. You can skim down to §15.50 to read the statute.
Generally, if the non-compete is directly related to the employment, restricted to the employees activities and a reasonable geographical area, and secured through valid consideration (which generally means continued employment or some sort of monetary incentive), it will be enforceable. The most recent precedent from the Texas Supreme Court on this subject is the case of Marsh USA v. Cook. I have included a link to this case below, so you can review it and see that the courts will generally enforce a non-compete agreement which meets the requirements discussed above.
I strongly encourage anyone who is considering a non-compete arrangement to consult an experienced labor and employment attorney and go over the document item by item. There are many good employment lawyers in the Valley, or my firm would be happy to assist you. You can reach me at WFB@BroemerLaw.com.
Your question has been answered as a courtesy. This is not paid legal advice. Nothing in this communication is intended to create an attorney-client relationship. Unless expressly stated otherwise, nothing contained in this message should be construed as a digital or electronic signature, nor is it intended to reflect an intention to make an agreement by electronic means.
3 lawyers agree
Car / Auto Accident Lawyer
As one of my colleagues has already stated, the Texas Business Organization Code Section 15.50 is applicable to your situation. Principally this section:
". . . a covenant not to compete is enforceable if it is ancillary to or part of an
otherwise enforceable agreement at the time the agreement is made
to the extent that it contains limitations as to time, geographical
area, and scope of activity to be restrained that are reasonable and
do not impose a greater restraint than is necessary to protect the
goodwill or other business interest of the promisee."
You should review your non-compete agreement to determine whether there was a certain time length required regarding your employment or whether there was a particular level of employment that you had to reach in order to solidify the agreement. Current Texas caselaw sides with the contract formed (the non-compete agreement) between the employer and employer before your employment departure unless you can demonstrate that the factors listed above will not affect the past employer's business.