Startup trying to poach my employee - is their non-compete enforceable?

I run a B2B SaaS company in Texas (15 employees). Our head of sales just gave notice - she's leaving to join a direct competitor that just raised a Series A. She signed a 2-year non-compete when we hired her 18 months ago.

The non-compete says she can't work for any competing software company within the US for 2 years. She's literally going to our biggest competitor. They know she has a non-compete because she told them.

Can I actually enforce this? What are my options?

Texas is actually one of the more employer-friendly states for non-competes. They're enforceable if they're reasonable in:

• Geographic scope
• Duration
• Scope of prohibited activity

A 2-year nationwide ban on working in software is almost certainly too broad. Texas courts look for non-competes that protect legitimate business interests without being oppressive to the employee.

What did she get in exchange for signing it? Just the job, or additional consideration?

She signed it as part of her offer letter when we hired her. Base salary was $95k plus commission. Is that enough consideration?

The geographic scope says "United States" - is that too broad? We only have customers in the US.

The job itself can be sufficient consideration in Texas if she signed it at the start of employment. If you had asked her to sign it after she was already working there without additional pay, that would be a problem.

The nationwide scope is likely too broad unless you can show you actually compete nationwide. Even if you have customers across the US, courts usually limit it to areas where you have a real competitive presence.

What industry is this? What does she actually know that's competitively sensitive?

We're in HR tech. She has access to our entire customer list, pricing strategy, product roadmap, and sales playbook. She literally knows everything about how we sell and who we sell to.

If she takes all that to our competitor, we're screwed. They'll know exactly how to undercut us.

That's exactly the kind of protectable interest that makes a non-compete enforceable. Customer lists, pricing strategies, and confidential business information are legitimate concerns.

However, you might have better luck with:

1. A non-solicitation agreement (preventing her from contacting your customers)
2. A trade secret/confidentiality claim
3. Asking the court to narrow the non-compete to something reasonable

Did she also sign an NDA or confidentiality agreement?

Yes, she signed a separate NDA. It's got a standard confidentiality clause covering customer info, trade secrets, etc.

So should I just threaten to sue her and the new company, or actually file?

Before you go nuclear, consider this: litigation is insanely expensive and time-consuming. You'll spend $50k-$100k+ in legal fees, and it'll take 12-18 months to resolve.

Most of the time, the threat of a lawsuit is enough. Send a cease and desist to both her and the new company. A lot of companies will back off once they realize you're serious.

Also, if you sue for injunctive relief, you'll need to post a bond which could be $25k-$50k.

I'd recommend a three-step approach:

1. Immediate: Send a cease and desist to her and the new employer, citing both the non-compete and NDA
2. Within 7 days: If they don't back down, file for a temporary restraining order and preliminary injunction
3. Ongoing: Conduct exit interview, collect all company property, revoke system access immediately

The NDA claim might actually be stronger than the non-compete. Focus on the confidential information she has access to.

I went through something similar last year. We sent a cease and desist to the employee and their new employer. The new employer's lawyers responded saying our non-compete was unenforceable and they weren't backing down.

We ended up settling - she agreed to wait 6 months before starting (we paid her half salary during the waiting period), and she signed a stronger non-solicitation agreement.

Cost us about $30k in legal fees plus the settlement payment, but it was cheaper than full litigation.

This is super helpful. I'm going to have our lawyer draft a cease and desist this week. Her last day is August 22, so we have a little time.

One more question - should we tell our customers she's leaving before she has a chance to reach out to them?

Absolutely yes. Get ahead of this. Have someone senior (you or another exec) reach out to your top customers immediately. Don't badmouth her, just let them know:

• She's leaving the company
• Here's who will be taking over their account
• Ensure continuity of service

This serves two purposes: 1) Protects your customer relationships, and 2) Creates a record that you took immediate action to protect your business interests, which helps if you end up in court.

Update: Sent cease and desist on Aug 13. The competitor's lawyer responded today saying they believe the non-compete is unenforceable but they're willing to discuss a resolution. They suggested she work in a different role that doesn't involve our customer segment.

Meeting with our attorney tomorrow to discuss next steps. Thanks for all the advice - this helped me understand what we're dealing with.