Non-Compete Agreements in 2026: What's Actually Enforceable?

Non-compete agreements are under unprecedented legal pressure in 2026. The FTC attempted a nationwide ban in 2024, though federal court challenges continue. Meanwhile, state-level restrictions are accelerating. Here is the current landscape.

States That Have Banned Non-Competes for Employees

**California**: Has banned employee non-competes since 1872 under Business & Professions Code § 16600. Recent legislation (SB 699, AB 2288) strengthened the ban and made attempts to enforce California non-competes a tort, exposing employers to attorney's fees.

**Minnesota**: Banned non-competes for employees effective January 1, 2023. Existing non-competes were voided.

**North Dakota**: Long-standing ban except for business sale and dissolution contexts.

**Oklahoma**: Bans employee non-competes except for business sale transactions.

States With Significant Restrictions

**Illinois**: Non-compete agreements unenforceable for employees earning under $75,000/year.

**Colorado**: Non-competes generally unenforceable except for key employees earning 60% of the threshold for highly compensated employees.

**Washington**: Non-competes unenforceable for employees earning under $116,593/year (2026 threshold); 18-month maximum duration.

**Oregon**: Non-competes limited to 18 months with advance notice and garden leave pay requirements.

**Massachusetts**: One-year maximum; requires advance notice; "garden leave" (payment) requirement.

**Virginia**: Non-competes unenforceable for "low-wage" employees (those earning average weekly wage of $1,290 or less).

States With Traditional Enforcement (With Reasonableness Requirements)

Most other states — Texas, New York, Florida, Georgia, Pennsylvania, Ohio — enforce reasonable non-competes under a common law "reasonableness" test. Courts evaluate:

1. **Duration**: 6 months to 2 years is typically upheld; 5 years is rarely upheld for employees 2. **Geographic scope**: Must be tied to where the employee actually worked or had customer contact 3. **Scope of restricted activity**: Must protect a legitimate business interest (trade secrets, customer relationships, specialized training)

Non-Solicitation Agreements: More Consistently Enforceable

Even in states that restrict non-competes, non-solicitation agreements (preventing the former employee from soliciting your clients or employees) are generally more enforceable. They are narrower in scope and more clearly tied to protecting legitimate business interests.