Non Compete agreement validity for contract to hire positions

It is a little hard to understand what your situation is. It sounds like: Texas Employer hired you; Texas Employer has relationship with Vendor; Texas Employer assigned you to work for Vendor; Vendor has a contract with California End Client; Vendor assigned you to work with California End Client; California End Client wants to hire you directly. First, I do not know Texas law. The non-compete language may or may not be enforceable in Texas. However, California has a strong interest in enforcing its own employment laws and if your work was done in California, you are probably a California employee. Generally: If you were an actual employee of Texas Employer and all the work was in California, the non-compete agreement wouldn’t be enforceable in California and you would be free to work for California End Client, except in some very specific situations that do not appear to be present in your situation. If you receive W-2 wages, you are an employee. If you were an independent contractor of Texas Employer and all the work was in California, the non-compete language might be enforceable. An attorney would have to review the entire contract to figure it out. If you receive 1099 payments, you may or ma not be an independent contractor under California law. An attorney would have to review the employment relationship to figure it out. Please see my guide detailing which workers are employees and which workers are independent contractors: http://www.attorneyqna.com/legal-guides/ugc/independent-contractor-or-employee--federal-and-california-law. You are always safest to take your situation to an experienced plaintiffs employment attorney for review and discussion. Logically, an attorney will have to read the contract in full – not just the specific non-compete language – and get some details from you. It makes sense for you to spend $1,000 to $2,000 for this consultation. If you have to retain an attorney to defend you against legal action by Texas Employer, it will certainly cost you far more than a couple thousand dollars. To find a plaintiffs employment attorney in California, please go to the web site of the California Employment Lawyers Association (CELA). CELA is the largest and most influential bar association in the state for attorneys who represent working people. The web site is www.cela.org. Click on "Find a CELA Member" and you can search by location and practice area. However, you are not limited to retaining an attorney in your geographic area, especially for such a short relationship. I hope you can resolve your situation and wish you the best.

With a few exceptions (which likely aren't applicable in your case) noncompetes such as the one you describe are *always* illegal in California. It does not matter whether you are an employee or an independent contractor. So the only question that remains is: will Texas or California law apply? I don't know Texas law, but let's assume for the sake of argument that it's worse than California law. California will not honor a noncompete against its own employees without a judgment or order from a Texas court saying that it must. So to make the noncompete enforceable, the Texas company would have to sue you in Texas (giving you notice and chance to be heard, of course), and then obtain a court order or judgment before you were able to get one in California. Whether a Texas court would honor the noncompete or not is something I can't tell you. Most multi-state contracts have a "choice of law" provision, which will tell you which state's laws apply. Even if the contract says that Texas law applies, however, California still won't honor it without a Texas court judgment or order. I hope this information is helpful to you. Good luck with your legal issues. Sincerely, Craig T. Byrnes www.ctblawfirm.com