Non-competes are legal in Texas but enforceability of such clauses will depend on the facts of the particular circumstances. The limitations placed on you must be reasonable with respect to geography, time, and scope of activity prohibited.
For instance, banning you from working in the whole of Houston might be too broad, but banning you from working in, say, Sugarland might be okay. The basic idea to consider is whether the restrictions are aimed at protecting their business or just punishing you.
This is an incomplete answer written in response to the limited facts provided. It is intended as a courtesy to better inform the reader about his or her possible rights and potential courses of action; it is not intended as formally researched legal advice or as an agreement to enter into an attorney-client relationship.
I agree with Mr. Diep that it depends on the terms of the non-compete agreement. I might disagree with the inability to ban a day care worker from employment in the entirety of Sugar Land. The length of time and type of work are also a consideration.
I suggest that you consult with an employment law attorney for advice after discussing all of the relevant facts and allowing him to review the agreement itself. You can use AVVO's tool "Find a Lawyer" to locate attorneys in labor law close to you. You can also ask your network of family and friends for any recommendations they may have.
My response herein is an attempt to give you general information and direction and is not intended to constitute an attorney-client relationship as perceived by state law.
In Texas, an employer may make execution of a non-compete agreement a condition of (new or continued) employment. That includes temporary or seasonal employment. Employers can adopt a “sign it or leave” policy. That alone will not invalidate an otherwise enforceable non-compete agreement.
Non-compete agreements are general contracts, and enforceable against employees, contractors, consultants, and any other contracting party. 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 underlying contractual or employment relationship, restricted to the individual's activities and a reasonable geographical area, and secured through valid consideration (which generally means continued work, 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 you to consult with an experienced labor and employment attorney face-to-face. Allow him/her to review the agreement and surrounding facts then give you more specific advice.
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.
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