Non-Solicitation of Customers and Employees: Enforceability in Texas

Non-solicitation clauses are non-competes under Texas law

Employers sometimes assume that a clause barring a former employee from soliciting customers is a lesser restriction that escapes the scrutiny applied to non-competes. In Texas it does not. In Marsh USA Inc. v. Cook (2011) the Texas Supreme Court treated a covenant not to solicit customers as a restraint on trade that falls within the Covenants Not to Compete Act, Business and Commerce Code section 15.50. Texas courts of appeals have applied the same framework to agreements not to solicit or hire the company's employees.

That means two things. The clause must pass the same two-part test as a full non-compete: it must be ancillary to an otherwise enforceable agreement, which usually means the company promised and provided confidential information, training or equity, and its limits must be reasonable. And if it is too broad, the court reforms it under section 15.51(c) instead of striking it, at the cost of pre-reformation damages. The test itself is explained in is my non-compete enforceable in Texas, and the reformation rule in what happens when a covenant is too broad.

Why non-solicitation clauses are easier to enforce

The advantage of a non-solicitation clause is that it is naturally narrower. A non-compete bars the employee from working for a competitor at all; a non-solicitation clause lets the employee take the job and bars only the diversion of specific relationships. Texas courts have long treated a restriction limited to customers the employee actually dealt with as a reasonable substitute for a geographic limit, so a well-drafted customer non-solicit needs no map.

What a court looks for in a customer non-solicit:

• A connection to the employee. Customers the employee served, managed or obtained confidential information about during a defined look-back period, often the last year or two of employment. Clauses reaching every customer of the company, including ones the employee never knew existed, are the classic overbroad draft.
• A reasonable period. Long enough for the company to re-establish the relationship with a new representative; the Act fixes no number for ordinary employees, so the term must be one the company can justify.
• A defined activity. Soliciting for competing products or services, not every form of contact. A clause that bars an employee from doing business with a former customer in an unrelated line is broader than the goodwill it protects.

Employee non-solicitation, or anti-raiding, clauses

A clause barring a former employee from recruiting the company's remaining staff protects a different interest: the investment in a trained workforce and the stability of customer teams. Texas courts have enforced these when they are tied to employees the departing person worked with or supervised and limited to a reasonable period. Clauses that bar “hiring” as well as “soliciting,” or that cover every employee of a large company, draw the same overbreadth arguments as a customer clause that covers every account.

The employee side will argue that co-workers are free to leave at will and that a clause restricting their job opportunities restrains people who never signed it. Courts have generally answered that the clause binds only the departing employee's conduct, not the co-workers' choices, but the argument carries more weight the broader the clause reaches.

What counts as solicitation

This is where most non-solicitation disputes are actually fought. The employee's version is usually that the customers called first, that they were only responding to inquiries, or that a social media announcement of a new job is not solicitation. The company's version is that a series of lunches, a “just letting you know where I landed” email to fifty accounts, and a quote sent two days later add up to solicitation whatever the first message said.

Texas courts decide this on the facts, and the wording of the clause matters. A clause that bars only “soliciting” leaves room for the argument that accepting unsolicited business is permitted. A clause that bars soliciting, accepting or servicing the covered customers closes that gap, though it also restrains more and must be justified as reasonable. Employers that want the broader protection should draft for it rather than argue later that “solicit” meant more than it says.

Example

Suppose a Dallas insurance agency's producer agreement bars a departing producer, for two years, from soliciting any client the producer serviced in the prior eighteen months. A producer leaves for another agency and posts a new-job announcement online. Within three weeks, nine of her former accounts have moved. Her new agency says the clients reached out on their own after seeing the post.

The agency subpoenas the new agency's new-business files and finds that the producer emailed renewal comparisons to seven of the nine accounts before any of them had contacted her. For those seven the solicitation question is settled. For the two that did contact her first, the clause bars only soliciting, so the agency's claim is weaker and it argues instead that she used confidential renewal dates to time her outreach. The court grants a temporary injunction barring further contact with the covered clients for the balance of the two years and leaves the two disputed accounts for trial. A clause that had also barred accepting the covered clients' business would have reached all nine.

What the former employee will argue

• The clause is a non-compete in disguise and fails section 15.50 for lack of consideration or reasonable limits.
• The customer list it protects is not confidential: the accounts are known in the market and the relationships belong to the producer, not the company.
• The customers contacted the employee first, and responding is not soliciting.
• The company itself waived the clause by not enforcing it against earlier departures.
• The clause reaches customers the employee never dealt with and must be reformed, which eliminates damages for the period before the court acts.

Enforcing a non-solicitation clause

The steps track those for any restrictive covenant: confirm the agreement and the consideration, document the contacts with covered customers or employees, preserve the departing employee's devices and accounts, send a letter to the employee and the new employer, and seek a temporary injunction if the conduct continues. The sequence is laid out in how to enforce a non-compete against a former employee, and the same hearing rules apply.

Evidence specific to solicitation cases: the customers' own accounts of who contacted whom and when, the departing employee's calendar and phone records for the final weeks, CRM export logs, and the new employer's onboarding records for the accounts in question. Customer testimony is often decisive and often reluctant, so a litigator will usually seek it through subpoena rather than ask the sales team to collect statements.

Drafting for the next hire

Because reformation costs the employer its damages for the pre-suit period, the better draft is the one that needs no reformation. For most sales and account roles that means a customer non-solicit limited to accounts the employee handled in a defined look-back period, a term the company can explain, a definition of restricted activity that says whether accepting business is covered, and an anti-raiding clause limited to co-workers the employee worked with. Paired with a confidentiality agreement and a clear exit protocol, that combination protects the company's relationships without the enforcement risk of a sweeping non-compete. Tina Wysk represents Dallas-area employers enforcing non-solicitation and non-compete agreements in state and federal court.