Non-Compete Agreements: Are They Enforceable?

Non-compete agreements have become a major flashpoint in employment law, with enforceability varying dramatically depending on the state — and recent regulatory action aiming to limit them further.

The Traditional Enforceability Standard

In states that allow non-competes, courts typically require the restriction to be reasonable in scope, geography, and duration, and to protect a legitimate business interest such as trade secrets or genuine customer relationships, rather than simply preventing ordinary competition.

An overly broad non-compete — covering too large a geographic area, too long a time period, or too wide a range of roles — is often struck down or narrowed ("blue-penciled") by a court, even in states that generally allow these agreements.

States That Restrict or Ban Non-Competes

Several states, including California, have banned non-compete agreements for employees almost entirely, treating them as void and unenforceable regardless of how reasonably they're drafted.

Other states have imposed significant restrictions, such as banning non-competes for lower-wage workers or requiring specific compensation in exchange for the restriction.

What to Do Before Signing — or After Leaving

Before signing, understanding exactly what the agreement restricts, and negotiating its scope if possible, can prevent problems later — non-competes are far easier to address before signing than after a dispute arises.

After leaving a job, an employee facing a non-compete dispute should have an attorney review both the agreement's enforceability under the applicable state law and whether the new position genuinely falls within its restrictions.

When a federal agency fails to act on a matter it is required to decide, the Administrative Procedure Act lets a court compel action that has been unreasonably delayed; this explainer covers the difference between an APA delay claim and mandamus.

Frequently Asked Questions

Can my employer stop me from working for a competitor after I quit?

It depends heavily on your state's law and the specific terms of any agreement you signed — this isn't automatically enforceable everywhere.

Are non-solicitation agreements the same as non-competes?

No — non-solicitation agreements, which restrict poaching clients or employees, are treated somewhat differently and are often more likely to be enforced even in states skeptical of broad non-competes.

Non-compete enforceability varies enormously by state and by the specific terms of the agreement. An employment attorney can help you understand whether an agreement you signed — or are being asked to sign — is likely enforceable.