US non-compete law is in active transition. The FTC's non-compete ban rule (2024) was vacated in federal court (2025) and is under appeal — the enforcement landscape is split by state. The practical rule: read the clause, know your state, and negotiate the scope before signing. This guide is informational, not legal advice.
State Reality Map
- California, Minnesota, Oklahoma, North Dakota: non-competes are void (statutory).
- Most states: enforceable only if "reasonable in time, geography, and scope" with legitimate business interest. Courts often narrow, blue-pencil, or void overbroad clauses.
- Massachusetts, Oregon, Washington, Illinois: statutory conditions — notice, garden-leave pay, income thresholds, and limits on non-competes for non-exempt workers.
Non-Solicits Are the Real Trap
Employee non-solicits (12–24 months) are widely enforced even where non-competes fail. They stop you from recruiting former coworkers into your new venture. If your plan involves hiring ex-colleagues, negotiate the non-solicit carve-out before signing: "no solicitation of employees for 12 months, excluding those who respond to public job postings."
Trade Secrets vs. Your Skills
The Defend Trade Secrets Act (ftc.gov guidance) protects confidential information, not your general skills and knowledge. General industry know-how, relationships, and methods learned on the job are yours. Confidential customer lists, source code, pricing models, and roadmaps are not.
Before You Sign an Offer
- Ask for the non-compete/non-solicit language in writing pre-offer; negotiate scope, geography, duration, and carve-outs (startups, public postings, prior-role clients).
- Get garden-leave: a clause requiring paid notice during enforcement makes the clause expensive for the employer to use.
- Document what you worked on before joining — background IP is yours.
Leaving with clean paperwork? The exit checklist guide and the farewell email generator protect your network within solicitation rules. For role-change scripts that avoid naming competitors in writing, see the two-week notice generator.
Put the rule into action
State law controls, and it varies sharply
Non-compete enforceability is a state question. A federal rule banning most non-competes was set aside in court, so state law decides: some states void non-competes outright, several limit them by income threshold, role, notice period or duration, and many enforce them with injunctions and fee-shifting clauses. Garden leave and the trade-secret route are the common substitutes where the covenant itself is weak.
Four lines in your agreement decide the risk: the governing state, the duration, the geographic or client scope, and the venue plus fee-shifting clause. A fee-shifting clause means you pay the other side's legal fees if you lose, which changes whether fighting is rational. The non-compete entry explains the structure, and the non-solicitation entry covers the narrower covenant that survives more often.
What a covenant does not control
- Your general skills and experience: covenants restrict competition, not competence.
- Trade secrets vs general knowledge: the secret route requires actual confidential information; knowing a market well is not a secret.
- Non-solicitation of clients vs non-competition: often the clause that is enforced, and it is narrower than a ban on working.
- Short-term roles and low pay: several states restrict covenants where earnings sit below a threshold or where the role had no access to secrets.
- Notice and consideration: a covenant signed after hire without new consideration is weaker in many states.
Write the disclosure before you accept a competing role: name the clause, its duration, its scope, and the state whose law governs. The non-compete disclosure generator produces that letter in the standard format, which is the document that shows good faith later.
Reading your own agreement, line by line
Take the agreement and answer these in writing before you make any move:
- Which state's law governs, and does the venue clause force you to litigate far away?
- Duration: how many months, and from which date?
- Scope: competitors named, industries described, or clients contacted?
- Does it survive a layoff, and is there a release clause for involuntary separation?
- Fee-shifting, injunction, and garden-leave interaction: see the garden-leave entry.
- Any income-threshold or role-based restriction in the governing state.
Then check the overlap with your new role: same clients, same market, same geography. Where the overlap is thin and the covenant is broad, the exposure is mostly litigation cost, not injunction. Where the overlap is real, ask the new employer in writing what they will fund if the clause is tested.
Scripts and wording
"I have a restrictive covenant from my prior employer: governing state [state], [N] months from separation, covering [scope]. My new role involves [scope]. I am disclosing it now, and I would like written confirmation of how the company handles a challenge, including legal support and any limitation on my client contact during the restricted period."
Disclose early, in writing, with the four facts named. A disclosure made after a complaint arrives is a credibility problem; a disclosure made on day one is a normal paperwork step. The disclosure generator formats it.
Enforceability Map By State Group
| State Group | What This Guide Records | What To Check In Your Clause |
|---|
| Statutory bans | California, Minnesota, Oklahoma and North Dakota void non-competes | Whether your agreement names a ban state |
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| Reasonableness states | Most states enforce only clauses reasonable in time, geography and scope | Duration and geographic scope as written |
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| Conditional states | Massachusetts, Oregon, Washington and Illinois add notice, garden-leave pay, income thresholds and limits for non-exempt workers | Notice timing and any garden-leave sentence |
|---|
| Federal rule status | The FTC ban was vacated in federal court in 2025 and is under appeal | Do not build your defense on the federal rule |
|---|
| Non-solicits | Widely enforced at 12 to 24 months even where non-competes fail | Employee versus client scope and the public-posting carve-out |
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| Trade-secret route | Covers confidential information, not general industry knowledge | Which lists, code or pricing you actually possess |
|---|
For the current text behind these numbers, start with the California job exit rules page and the Illinois job exit rules page, along with the Release of Claims definition and the hiring references non competes guide hub. Those sources state the rule in full; this page only points at them.
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Frequently Asked Questions
- Are non-competes banned?
- Not uniformly. A federal rule banning most non-competes was set aside in court, so state law controls: some states void them, several limit them by income or role, and many enforce them with injunctions and fee-shifting. The governing state in your agreement is the only one that matters. Read the non-compete entry.
- What is the clause most likely to be enforced?
- A narrow non-solicitation of clients you personally handled, tied to a short period. Broad bans on working in an industry are harder to enforce in many states and easier to enjoin in others. See the non-solicitation entry for the difference.
- Do I have to disclose an old non-compete to a new employer?
- Yes, before accepting. Disclosure is what lets the new employer decide to support you or to limit your client contact. Disclosing after a demand letter arrives turns a paperwork issue into a credibility issue. Use the non-compete disclosure generator.
- Does garden leave change the analysis?
- It can. Garden leave keeps you paid and employed while you stay out of the market, which preserves the non-solicit clock and makes a competing move a breach while you are still on payroll. Get the start date, end date and contact rules in writing. See the garden-leave entry and the garden leave notice generator.
Non-compete terms, the 12-24 month clocks, and the garden-leave pay requirement are tested under state law, and several states set statutory conditions with notice rules, income thresholds, and limits for non-exempt workers. Confirm the current state position with the state agency named on the state rule pages before you sign, and keep the clause text, the venue line, and the fee-shifting sentence in one dated file with the non-compete disclosure generator.