What are the rules governing non-competes, specifically one signed under duress and poorly worded?

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What are the rules governing non-competes, specifically one signed under duress and poorly worded?

I was accepted into a state-sponsored training course, which would license me to teach. Part of the preparation for the course was to work for a local “sponsor”. I spent appximately 80 hours working for them, and had driven about 50 miles to continue the work on this particular day, when I was presented with a non-compete. I had about 10 minutes to decide whether to sign it and continue or to not sign it thus losing all of the time/effort I had put into this endeavor. The document was poorly worded and unprofessional and basically open ended (no time limit). Is this a valid contract?

Asked on April 11, 2012 under Employment Labor Law, Texas

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

1) Being asked to sign a noncompete on short notice, at the risk of losing a job or internship and the value or benefits that comes with it, is not "duress" in a legal sense. You are free to choose to not sign the agreement if you feel the cost  of doing so outweighs the benefits of the position. It may be a hard bargain and it may be unfair, but because the employer is not using illegal means (e.g. blackmail, physical threats) to make you sign, but is simply giving you the choice to sign or not have that position, that is legal, and noncompetition agreements executed under such conditions are valid.

2) An open-ended noncompetition is likely overbroad, however. Courts will modify, or "blue pencil," noncompetiton agreements which are too long in duration or  too broad in the types of jobs or geographic areas covered--that is, the agreement could be enforced, if the employer went to court to enforce it, but it would likely be cut back to more reasonable levels. For most non-executive employees, a reasonable noncompete is for a period of 6 months to 1 year, depending on the area, nature of the job, etc.

3) An agreement does not have to be "professional" or well-written--that does not make it unenforceable. Rather, the issue is whether the intention of the parties--what the agreement is intended to cover--can be discerned from it. If the parties' intention can be determined, the agreement will be enforced; if there is some ambiguity, then a court, if called upon to adjudicate, will do its best to interpret the agreement in light of the parties' logical or otherwise expressed (e.g. through emails, memos, etc.) intentions. Only if there simply is no way to know what behavior is covered would poor draftsmanship preclude the agreement entirely from enforcement.


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