In early 2024, the Federal Trade Commission (FTC) attempted to ban nearly all non-compete agreements. However, in August, a federal court in Texas blocked the rule, leaving the regulation of non-competes to individual states. If you want more information about how non-compete agreements work, check out our YouTube video.
Prior to this year, California, Oklahoma, Minnesota, and North Dakota all had near-total bans on non-compete agreements. Colorado, Illinois, Maine, Maryland, New Hampshire, Oregon, Rhode Island, Virginia, Washington, and Washington D.C. all had specific salary thresholds for non-compete agreements. In just the first four months of this year, several states either enacted new legislation on non-competes or expanded existing laws.
Arkansas
On March 4, 2025, Arkansas amended its non-compete law to prohibit and void non-compete agreements restricting physicians. This law is set to go into effect on August 3, 2025.
Colorado
Earlier this year, Colorado updated the highly compensated employee threshold, meaning only employees earning $127,091 or more can be subject to a non-compete agreement. However, non-solicitation agreements are still valid for employees who earn $76,254 or more.
Last month, the Colorado legislature passed a bill preventing doctors, dentists, and nurses from being subject to non-compete and non-solicitation agreements. There are, however, certain provisions for the recovery of recruiting expenses, such as relocation expenses and signing bonuses, for these individuals. If the Colorado Governor signs the bill, it is set to take effect on August 6, 2025.
Florida
Last month, Florida passed the CHOICE Act, which allows non-compete agreements for “covered employees,” or individuals who earn twice the average annual income of their county of residence or the county of the business’s location. Florida courts are required to issue temporary injunctions if a covered employee is found to violate the Act. Check out our Reel here to learn more about the CHOICE Act.
Louisiana
Louisiana added restrictions to non-compete agreements with physicians. Non-competes with primary care physicians may not exceed three years, or five years for all other physicians. These restrictions must also include qualified parish-specific geographic limitations.
Maryland
Maryland expanded its current non-compete prohibition to include naturopathic physicians, registered nurses, advanced practice nurses, and physician assistants.
Pennsylvania
Effective January 1, 2025, non-competes with healthcare professionals were prohibited.
Washington
Washington added an anti-moonlighting provision to its non-compete law. This provision restricts employers from entering into a non-compete agreement with employees who earn less than twice the state minimum wage. Check out our video for more information about Washington’s anti-moonlighting provision.
Wyoming
Wyoming enacted a law that voids all non-compete agreements entered into on or after July 1, 2025, with exceptions for executive and management personnel, recovering expenses (for relocation, education, and training), the sale of a business, and trade secret protections. Check out our video to learn more about Wyoming’s ban.
Non-compete laws are evolving rapidly, and they vary from state to state. Employers must pay close attention to stay compliant, especially if they have employees across multiple states. Follow Lockaby PLLC for ongoing updates on all things non-compete.
