Ever since the Texas Supreme Court’s confusing 1994 opinion in Light v. Centel Cellular Co., courts have struggled to assess in a coherent and consistent manner whether a noncompete, executed in connection with an at-will employment relationship, is “ancillary to an otherwise enforceable agreement” under the Texas Business and Commerce Code. Thankfully, over time, the court has refined the threshold test for enforceability of noncompetes.
But what about the threshold enforceability of noncompetes and confidentiality agreements that are executed in the middle of an employment relationship? This article addresses the state of the law on these agreements and how employers can bolster the enforceability of these agreements.
The Threshold Enforceability
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