Is an independent contractor bound by a non-compete?

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Is an independent contractor bound by a non-compete?

If I signed a non-compete agreement with a company that I do work for as a 1099 contractor, and my wife starts a business the same as the company I do work for, am I able to do work for her business? Also, the same non-compete agreement shows that I am an employee which I am not, am I still bound by it?

Asked on May 22, 2011 under Employment Labor Law, Texas

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

1) As a general matter, an independent contractor may be bound by a noncompetition agreement. It is simply a contract; if you agree to it, you are bound by it.

2) The fact that you are misidentified as an employee probably does not affect the validity for enforceability of the agreement, as long as it is clear from the agreement, from other documents or correspondence, and from the context that it was intended to bind you even though you were an independent contractor at the time, and that you agreed to be bound.

3) It can even bind you vis-a-vis a business owned or run by a family member, including your spouse.


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