Drafting Non-Compete Agreements in Texas

blog_post_default_featured_image.png

Austin Startup Attorney Natalie Lynch Creates Non-Compete Agreements

A Non-Compete Agreement is an essential aspect of the Employment Agreement. Upon the termination of an employment relationship a non-compete agreement can protect an employer’s business secrets from competitors. These agreements are highly contentious and frowned upon by most states. If they are not drafted precisely right, they will not serve to protect a company.. Further, this is an area of law that is very active and old or template Non-Compete agreements may not be effective. The agreement often provides geographic limits regarding where the employee can work as well as a contractual duration. The Lynch Law Firm can assist your start up in drafting a Non-Compete Agreement to protect your business from the loss of confidential information regarding your products, services, techniques, or processes to competitors.

Three Reasons Your Startup Needs a Non-Compete Agreement

  1. Protection. A non-compete agreement protects your startup from losing valuable trade secrets to competitors in the same field or business. Also, the agreement protects your business from the loss of business and customers resulting from a competitor’s use of your trade secrets.
  2. Employee  Retention. Considerable time and money is spent hiring and training good employees. Those employees will have access and be trained to use your trade secrets. A well-drafted Non-Compete Agreement can discourage an employee from leaving your startup and prevent them from taking your valuable trade secrets to work for direct competitors.
  3. Avoiding Lawsuits. A non-compete agreement can aid your startup by having clear exit terms and penalties in the event of the departure of an employee. The Lynch Law Firm can help your startup avoid costly lawsuits and litigation as the result of an employee taking trade secrets or customers from your business.

Three Common Mistakes in Non-Compete Agreements

  1. Overly Broad Language. The non-compete agreement needs to avoid overly broad or vague terms. Upon termination of an employment relationship, there need to be clear expectations regarding the employee’s exit and ability to use your hard earned trade assets.
  2. Overly long non-compete term. The non-compete term for the exiting employee must be very specifically tailored to the life cycle of the trade secret you intend to protect. The Lynch Law Firm can assist you in determining an appropriate amount of time to limit the employee from using your trade secrets with a competitor.
  3. Overly large geographic area. The non-compete agreement must not include an overly large geographic area in which the employee is restricted. The Lynch Law Firm can assist you in determining the appropriate scope of the geographic non-compete area.

If you would like assistance drafting a Non-Compete Agreement, please contact Natalie Lynch at (512) 298-2346 or nlynch@lynchlf.com.


Recent Posts