The White House Speaks On Non-Compete Agreements
“Non-competes are often given to workers that do not possess trade secrets”
On May 5, 2016, the White House issued a report on non-compete agreements. Employers provide non-competes to protect their trade secrets and confidential information. However, the US Treasury Department found that non-competes are often given to workers that do not possess trade secrets. When used appropriately, non-competes can play an important role in protecting a business, but in some cases, they impose substantial costs to workers and hinder the economy.
The White House has presented seven (7) potential issues with non-competes:
1. Workers who are unlikely to possess trade secrets are nonetheless compelled to sign non-competes;
2. Workers are asked to sign non-competes only after accepting a job offer, when they have already declined other offers and thus have less leverage to bargain;
3. Non-competes, their implications, and their enforceability are often unclear to workers;
4. Employers often write non-compete agreements that are overly broad or unenforceable;
5. Employers requiring non-competes often do not provide “consideration” that is above and beyond continued employment;
6. In some cases, non-competes can prevent workers from finding new employment even after being fired without cause; and
7. In some sectors, non-competes can have a detrimental effect on health and well-being by restricting consumer choice.
These issues can and should be avoided. Texas employers should take steps to address these potential issues, which may increase an employer’s ability to enforce a non-compete agreement.
To speak to an employment law attorney about non-compete agreements, send an email to email@example.com or call (214) 239-2705. This article is presented by the Dallas employment law lawyers at Clouse Dunn LLP.