Are Non-Competes Enforceable in Texas?
Last updated: 2026-10-07 · Verified against the statutes 2026-10-07
Enforceable — statute sets rules
Enforceable if reasonable; courts must reform overbroad terms
A Texas non-compete is enforceable if it is ancillary to or part of an otherwise enforceable agreement and reasonable in time, geographic area and scope of activity. If it is overbroad, the court must reform it and enforce it as reformed, but cannot award damages for a breach before reformation. The statute replaces common-law rules. Since September 1, 2025, covenants with physicians, dentists, nurses and physician assistants must include a buyout capped at one year's pay and are limited to one year and five miles.
Check a non-compete
Answer a few questions; the result cites the statute behind each point. Rules verified 2026-10-07. Saved only in your browser.
Thresholds are measured differently by state (salary, cash compensation, W-2 box 1).
Enforceable if reasonable
Texas enforces non-competes that protect a legitimate business interest and are reasonable in time, geography and scope.
- Texas: Enforceable if reasonable; courts must reform overbroad terms. Tex. Bus. & Com. Code 15.50-15.52
Other Texas rules to check
- If a court finds it too broad: Courts may narrow an overbroad covenant to what's reasonable.
- Penalties: For personal-services covenants, a court may award the employee costs and attorney's fees if the employer knew the limits were unreasonable when signed and tried to enforce them more broadly than necessary.
General information, not legal advice. Enforceability also depends on the exact wording, the employer's legitimate interest and the facts; talk to an employment lawyer before relying on it.
Texas non-compete rules
- Signed mid-employment
- For at-will employees, the covenant becomes enforceable once the employer actually performs its promise (for example, by providing confidential information or specialized training) (Alex Sheshunoff Mgmt. Servs. v. Johnson, Tex. 2006).
- Overbroad covenants
- Courts may narrow an overbroad covenant to what's reasonable
- Penalties
- For personal-services covenants, a court may award the employee costs and attorney's fees if the employer knew the limits were unreasonable when signed and tried to enforce them more broadly than necessary.
Profession-specific rules
- LimitedPhysician covenants must allow access to patient lists and records, a buyout no higher than the physician's total annual salary and wages, and continuing care for acutely ill patients; they must expire within 1 year, reach no more than 5 miles from the primary practice location, be clearly and conspicuously written, and are void if the physician is discharged without good cause. Applies to covenants entered into or renewed on or after September 1, 2025. (effective September 1, 2025) Tex. Bus. & Com. Code 15.50 (SB 1318, 2025)
- LimitedCovenants with dentists, licensed professional or vocational nurses and physician assistants are unenforceable unless they include a buyout capped at annual salary and wages, expire within 1 year, are limited to 5 miles and are clearly and conspicuously written. (effective September 1, 2025) Tex. Bus. & Com. Code 15.501 (SB 1318, 2025)
Recent and pending changes
- September 1, 2025: SB 1318 tightens physician covenant rules and adds limits for dentists, nurses and PAs (covenants entered into or renewed on or after this date). SB 1318 (89th Leg.) enrolled
Federal law
There is no federal ban on employee non-competes. The FTC's 2024 Non-Compete Clause Rule (16 CFR Part 910), which would have voided most non-competes from September 4, 2024, never took effect: a Texas federal court set it aside nationwide on August 20, 2024 (Ryan LLC v. FTC). On September 5, 2025 the Commission voted 3-1 to drop its appeals and accept that ruling, and on February 12, 2026 it formally removed Part 910 from the Code of Federal Regulations. State law therefore decides whether a non-compete is enforceable.
Frequently asked questions
Are non-competes enforceable in Texas?
Enforceable if reasonable; courts must reform overbroad terms. A Texas non-compete is enforceable if it is ancillary to or part of an otherwise enforceable agreement and reasonable in time, geographic area and scope of activity. If it is overbroad, the court must reform it and enforce it as reformed, but cannot award damages for a breach before reformation. The statute replaces common-law rules. Since September 1, 2025, covenants with physicians, dentists, nurses and physician assistants must include a buyout capped at one year's pay and are limited to one year and five miles.
Did the FTC ban non-competes in Texas?
No. The FTC's 2024 rule never took effect — a federal court set it aside in August 2024, the FTC dropped its appeals in September 2025 and removed the rule from the Code of Federal Regulations in February 2026. State law controls, though the FTC still challenges some non-competes case by case.
Official Sources
Figures checked against these sources on 2026-10-07Other states
Same category (Enforceable — statute sets rules): Alabama, Arkansas, Florida, Georgia, Hawaii, Idaho, Louisiana, Michigan
Protect information instead with a confidentiality agreement (NDA generator), or hiring in Texas? Use the offer letter generator.
Not legal advice. Enforceability depends on the agreement's wording and the facts; consult an employment attorney licensed in Texas.