Employees in certain fields in the Houston area may find that they are asked to sign non-compete contracts. In general, a non-compete agreement, also called a covenant not to compete, is one provision in an employment agreement. Whether or not that agreement is legally enforceable depends on a number of factors.

Sometimes, when employees who are bound by these contracts chose to leave a company, they find that they may be getting into dangerous legal territories. One Texas company filed a lawsuit against a former employee late last month claiming that it lost a significant amount of money after the salesman left to work for a competitor.

The materials wholesaler reportedly hired the salesman in 2007 and it is unclear whether he signed a covenant not to compete. However, throughout the years that the man worked for the wholesaler, he may have acquired confidential and trade secrets.

In March, the man suddenly resigned and he did not tell his employer where he was going to work.

Now, the former employer alleges that the salesman began working at a competitor the very day after his last shift, and that he had been in talks with this competitor while still employed by the company.

The former employer has accused the salesman of using trade secrets to steal its customers and bring them over to the competitor. Furthermore, the company alleges that its competitor is engaged in some sort of bounty system where salespeople are rewarded for this type of work.

When former employees are accused of actions like this, the repercussions can have a long lasting serious effect on their careers. They are often wise to consult employment law attorneys who have experience in these complicated matters.

Source: The Southeast Texas Record, “Materials wholesaler sues employee for going to competitor,” Kelly Holleran, Aug. 9, 2012

  • Our firm handles similar situations to the one discussed in this post. If you would like to learn more about our practice, please visit our Houston Non-Compete Agreements page.