Monday, September 29, 2008

Nuts and Bolts : Non-Solicitation vs. Non-Compete

Employers frequently require employees to enter into non-compete agreements, non-solicitation agreements, or a combination of both in order to protect trade-secrets and other valuable information.

Non-Solicitation Example:

Employee agrees that for a period of one year after the termination of his employment, whether voluntary or involuntary, he will not directly or indirectly call upon, solicit, divert, accept, or take away from Employer any individual, account, customer, company, partnership or any other entity to whom Employer rendered intermediary, consulting or brokering services, either on a fee for services or commission basis, during the course of his employment with Employer.

Non-Compete Example:

Salesperson agrees, upon termination of employment with company, and for a period of one year thereafter, she will not directly or indirectly compete with company in the Longview, Tyler, Marshall service area. Salesperson agrees that this paragraph prohibits her from accepting employment in the Longview, Tyler, Marshall service area from any mobile communications service provider, or any agent or reseller of a mobile communications service provider, as a salesperson, or in any other capacity that would give the salesperson customer contact or that would permit the use of the customer related information she acquired in the course of her employment with company.

Both provisions must comply with Texas Business and Commerce Code Section 15.50.