Breach of Contract and Non-Compete Agreement Validity

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Non-compete clauses are standard in employment contracts across a range of industries, in addition to similar contract clauses such as non-solicitation, non-disparagement, and non-disclosure agreements (NDAs).  The enforceability of non-compete contracts in Texas is a question that must be addressed on a case-by-case basis by examining both the employment agreement and the relevant factual circumstances that apply.

Unfortunately, professionals often sign an employment agreement without asking a Texas employment lawyer about the full implications of the agreement, the consequences for breach of contract, and the enforceability of non-compete agreements in Texas. As one example of a fairly common scenario, one employee asked:

“What if you sign an employment contract with a non-compete agreement, but the employer breaches the contract? My employer skimmed $50,000 of my commission revenue over several years without my knowledge. Is the non-compete agreement in the employment contract still effective?”

Breach of Contract & Employment Agreements

In general, employer breach of contract or fraudulent acts will not automatically cancel your employment contract.  The promises and covenants that two parties make to each other in a contract are typically independent and severable.  This means that breach of some of the terms by one party, or the unenforceability of some of the contract terms will not cancel or eliminate the enforceability of other provisions of the contract.  Thus, the non-compete clause, non-solicitation, non-disclosure, and other aspects of your employment agreement probably still apply despite the breach of contract or fraud.

However, if you have breach of contract, fraud, or other claims against your employer, you may bring a lawsuit against your employer to recover money or damages you deserve. That lawsuit could also seek a rescission of the employment contract or the non-compete clause.  If successful, such a lawsuit could establish your right to work without being harassed with non-competition cease and desist letters.

If you are experiencing problems with an employer who is in breach of contract or has committed other fraudulent acts, contact a Texas business litigation lawyer to get an analysis of the facts in your case.

Call a Texas Employment Lawyer, Free Consultation!

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