75 state noncompete bills: Arkansas and Wyoming pass, Virginia is pending governor action, two failed

We are now at 75 noncompete bills in 35 states. Two have resulted in new laws, a third is awaiting governor action today, and two have died. 

Of those bills, 31 focus on healthcare workers, 14 relate to low-wage workers, 14 propose full bans, and 6 include fines. 

New laws

First the new laws: Arkansas and Wyoming.

• Arkansas:
  • The new law provides, “A covenant not to compete agreement that restricts the right of a physician to practice within the physician’s scope of practice is void.”
    • For purposes of the new law, physician is defined as “a person authorized or licensed to practice medicine under the Arkansas Medical Practices Act, § 17-95-201 et seq., § 17-95-301 et seq., and § 17-95-401 et seq., and a person authorized to practice osteopathy under § 17-91-101 et seq.”
  • This law was signed on March 4 and, if the legislative session ends April 16 (as expected), the law will take effect 90 days later, on July 15.
  • It is unclear if the law will apply retroactively. On the one hand, the law purports to be a “clarification,” suggesting that it is not a substantive change. On the other hand, it sure looks like a substantive change, and the legislature did not state that it will apply retroactively, so presumably it will not. We will see.
• Wyoming: the new law is substantively a bit more complicated, and follows some ideas from Colorado’s now-abandoned approach.
  • The starting point is: “Any covenant not to compete that restricts the right of any person to receive compensation for performance of skilled or unskilled labor shall be void.” The new law expressly includes physician noncompetes.
  • But then the law provides the following exemptions (in connection with which noncompetes may be used):
    • “Any covenant not to compete contained in a contract for the purchase and sale of a business or the assets of a business”
    • “Any covenant not to compete to the extent the covenant provides for the protection of trade secrets”
    • “Executive and management personnel and officers and employees who constitute professional staff to executive and management personnel.”
  • The law also voids training repayment agreements (sometimes pejoratively called “TRAPs”) and expense relocation reimbursement agreements that do not satisfy certain new limitations. Specifically, the law allows such agreements if they comply with the following limitations: “(A) Recovery of not more than one hundred percent (100%) of the expense for an employee who has served an employer for a period of less than two (2) years; (B) Recovery of not more than sixty-six percent (66%) of the expense for an employee who has served an employer for between two (2) and less than three (3) years; (C) Recovery of not more than thirty-three percent (33%) of the expense for an employee who has served an employer for between three (3) and less than four (4) years.”
  • The law applies prospectively and will take effect on July 1, 2025.

Keep an eye out for Virginia (discussed below), which is awaiting governor action. He has until midnight tonight (March 22) to act.

Now, onto the bills…

They breakdown as follows (states marked in red have only new bills; states marked in orange have both new bills and bills from earlier in the year, and states in black have only the bills from earlier in the year):

• Arizona has one bill. It would ban noncompetes that are a condition of employment.
• Colorado has one bill. Primarily, the bill would ban noncompetes and nonsolicitation covenants (broadly interpreted) for physicians, physician assistants, advanced practice registered nurses, and dentists. It would also make a handful of tweaks to the existing law, including, for example, removing a reference to “for any employer,” presumably expanding the scope to independent contractors, and altering the sale of business exception, including providing protections for owners of a minority interest.
• Connecticut has two bills, one of which is new:
  • The first bill, discussed previously, is to eliminate the prohibitions on noncompetes. This bill is super-interesting insofar as it highlights that the broad-brush public perception that all states are trying to restrict or ban noncompetes is a bit more nuanced. While there is no doubt that the trend is to restrict the use of noncompetes (not to ban them), some states have been pushing back along the way — going back to 2011, when Georgia passed a constitutional amendment to make noncompetes more enforceable. (I did love the referendum, which Professor Matt Marx had called to my attention at the time: “Shall the Constitution of Georgia be amended so as to make Georgia more economically competitive by authorizing legislation to uphold reasonable competitive agreements?” Not quite the picture of clarity for informing people that they were voting to make noncompetes more enforceable.)
  • The second bill is new. Echoing several aspects of Massachusetts’ 2018 noncompete law (and from an early draft of the law), the bill would essentially establish wage-related thresholds and other job-related criteria (based on the Fair Labor Standards Act (FLSA)) for the use of noncompetes, limit noncompetes to one year (or two, if compensated during that time), and establish new standards for the use of noncompetes, including requirements for notice, disclosure of various issues, consideration, and choice of law and venue; it would also prohibit enforcement if the worker terminated their employment for good cause attributable to the employer. It would also impose limitations on the use of anti-moonlighting agreements (called “exclusivity agreements”) and adopt the red pencil rule, impose penalties, and allow enforcement by the attorney general.
• Florida has four bills:
  • The first bill would ban physician noncompetes.
  • The second bill would impose limitations on the use of noncompetes for physicians, including imposing a $250,000 wage threshold.
  • The third bill would significantly strengthen Florida’s already strong pro-noncompete laws, and enhance them with strong pro-notice of resignation (“true” garden leave) rules. Instructively, this bill, even more so than Connecticut’s, bucks the broad-brush public perception that all states are trying to restrict or ban noncompetes. To the contrary, this bill identifies some of the real concerns that justify (sometimes, anyway) the use of noncompetes:

• • The fourth bill is the Senate version of the third bill above (strengthening Florida’s noncompete/notice laws), albeit by a different name. Instructively, it also includes the same legislative finding as in the third bill.
• Hawaii has one bill. The bill adds restaurants and retail stores to businesses covered by the ban on the use of noncompetes and no-recruits (restrictions on soliciting employees), which is currently applicable only to employees in technology businesses.

Disturbingly, the bill states the following: “The legislature finds that in 2015, the State passed Act 158, Session Laws of Hawaii 2015, banning non-compete clauses for workers in the technology industry.  A 2017 study published by the United States Census Bureau Center for Economic Studies found that as a result of this ban, job mobility and new‑hire wages in the State increased by eleven per cent and four per cent, respectively.”

The problem with relying on that study is that the study was materially flawed, most significantly, in that it mistakenly concluded that the 2015 law included a ban on customer nonsolicitation agreements. It did not. It included only a ban of no-recruit agreements, not customer nonsolicitation agreements. As a result, the study ignored the impact of the ban on no-recruit agreements, which would have had a direct impact on employee mobility — and therefore on the results of the study. Without realizing the mistake, the study attempts to support its finding through a separate analysis of data from other states, purportedly showing similar results. But those results suffer from their own limitations. The bottom line is that, while the research may very well be the best we have, the best we have is fatally flawed and should not be relied upon to support legislation that will affect an entire state. (For more on the problems with the research in this area, see here and here.)

One more point: Perhaps most troubling (well, perhaps not most) is that someone got the sponsors of the bill to add a hyphen in “noncompete” and “nonsolicit.” I have been on a one-man mission to correct this mistake and remove the hyphen, so I will consider this is a setback if it passes. 😊

• Illinois has three bills:
  • The first bill would increase both the 2026 noncompete wage threshold ($80,000) and the 2026 nonsolicit wage threshold ($47,500) to $300,000 (and eliminate the subsequent modest increases).
  • The second bill, taking a page out of California’s playbook, proposes a ban of noncompetes (as well as nonsolicitation and no-recruit agreements) and provides that an “employer or former employer shall not attempt to enforce a contract that is void and unenforceable under this Act regardless of whether the contract was signed and the employment was maintained outside of this State.”
  • The third bill would prohibit noncompetes “with respect to the provision of reproductive health care or maternity care by a health care professional in this State if the enforcement of the covenant not to compete or covenant not to solicit is likely to reduce the availability of reproductive health care or maternity care.”
• Indiana has two bills:
  • The first bill would ban physician noncompetes.
  • The second bill would ban noncompetes.
• Iowa has one bill. It would impose a wage threshold, new standards, and penalties for the use of noncompetes and nonsolicitation agreements with registered nurses.
• Kansas has one bill relating to noncompetes (but not directly regulating them). Specifically, it allows operating agreements in limited liability companies to impose restrictive covenants.
  • Kansas also has another bill that, like Connecticut’s and Florida’s bills, would strengthen its restrictive covenant laws. Among other things, it would require mandatory reformation of overly broad restrictive covenants and establish conclusive presumptions of enforceability of certain nonsolicitation agreements.  
• Kentucky has two bills:
  • The first bill would, among other things, impose a $2,000 per week wage threshold for noncompetes, posting requirements, and fines (up to $10,000 per violation).
  • The second bill essentially adopts the FTC’s approach to a ban on noncompetes.
• Maryland has two mirror-image bills (one in the house and one in the senate). Both would revise current noncompete and anti-moonlighting limitations to apply only post-termination of employment, not during employment.
• Massachusetts has three bills:
  • The first bill would prohibit noncompetes for veterinarians.
  • The second bill is the perennial bill to ban noncompetes.
  • The third bill would link the consideration requirement for “other mutually agreed upon consideration” to require that it be “reasonably related to the requirements of the garden leave clause.”
• Michigan has one bill. It would ban noncompetes and impose attorneys’ fees for violations. It would also impose a wage-threshold for the use of nonsolicitation agreements.
• Minnesota has three bills:
  • The first bill would reverse the 2023 ban on noncompetes, and replace it with a wage threshold and other criteria.
  • The second bill would ban noncompetes by healthcare worker platforms (providing temporary healthcare workers).
  • The third bill is the house version of the second bill (banning noncompetes by healthcare worker platforms providing temporary healthcare workers).
• Mississippi has (had) two bills:
  • The first bill would (have) banned noncompetes for healthcare workers, but it has already died.
  • The second bill would ban noncompetes for temporary workers.
• Missouri has five bills, three of which are new:
  • The three new bills are as follows:
    • The first bill would impose limitations on the use of physician noncompetes (like those in the prior bill discussed below).
    • The second bill, taking a page from Nevada’s playbook, would ban noncompetes for hourly workers.
    • The third bill, in a complete reversal of the trend, would mandate the use of noncompete agreements for home healthcare providers under certain circumstances.
  • The two prior bills were as follows: 
    • One bill would impose significant limitations on the use of noncompetes with physicians. Specifically, noncompetes could be used for physicians, but only if the physician is providing healthcare services in a clinical setting for an employer that is not a health care entity owned or operated by a nonprofit corporation. And, when such agreements are allowed (1) they must extend no further than 50 miles from the physician’s office and (2), taking a page out of Washington, D.C.’s playbook, they can last no longer than 365 days. That is a trap for the unwary insofar as a one-year noncompete would presumably be invalid every four years (in a leap year). The way the bill is written, it (presumably unintentionally) can be read to restrict the duration even during employment, meaning that if the physician works for the employer for 365 days, he or she would be free to leave without the constraints of a noncompete. I am sure, if this bill moves forward, that will be fixed.
    • The other bill would ban noncompetes for physicians entirely.
• Montana has two bills:
  • The first bill would expand the ban on noncompetes for certain healthcare providers to naturopathic physicians, registered professional nurses, advanced practice registered nurses, and physician assistants.
  • The second bill would expand the ban on noncompetes for certain healthcare providers by removing the phrase “psychiatrist or addiction medicine” before physicians.
• Nebraska has one bill. It would prohibit healthcare staffing agencies from enforcing any noncompete “with any health care entity or staff worker that restricts in any manner the employment opportunities of a staff worker.”
• New Hampshire has one preexisting bill. It would prohibit “nursing agencies from including non-compete clauses in contracts with health care entities.”
• New Jersey has two noncompete bills, one of which is new:
  • The prior noncompete bill is as follows:
    • a bill placing restrictions on the use of physician noncompetes. Interesting about this bill, it expressly allows physician noncompetes in several different circumstances, including where the physician was paid a $50,000 signing bonus to join the practice or hospital.
  • The new bill is the Assembly version of the prior bill
  • New Jersey also has a previously-pending bill to ban training repayment agreements (pejoratively called “TRAPs”). This is another misplaced fad we’re seeing in noncompete-adjacent legislation. Once again, well-intentioned legislators are being sold a cure that is worse than the disease. More on that at another time.
• New York has five noncompete bills, three of which are new. It also has three additional bills (previously discussed) in New York City, as well as two noncompete-adjacent bills:
  • The first new bill would ban noncompetes for certain healthcare professionals and for anyone earning under $500,000 (to be adjusted annually for inflation).
  • The second new bill is the Assembly version of the monopsony bill discussed below.
  • The third new bill would prohibit noncompetes for low-wage workers, require the posting of notice and advance notice that a noncompete will be required, and impose fines, as well as permitting enforcement by the “commissioner.”
  • The two prior state bills and three prior New York City bills were as follows:
    • One bill tackles noncompetes through adding monopsonies (single buyers that substantially control a market) to its antitrust law. It affects noncompetes primarily through this series of provisions:

It shall be unlawful for any person or persons with a dominant position in the conduct of any business, trade or commerce, in any labor market, or in the furnishing of any service in this state to abuse that dominant position. This paragraph shall not apply to a person or persons that are independently owned and operated and employ one hundred or fewer persons.

* * *

In labor markets, abuse may include, but is not limited to, imposing restraints, direct or indirect, on the mobility of workers between employers or on the ability of workers to seek employment from multiple employers . . .

* * *

Any restraint on a person’s ability to engage in a profession, trade, or business of any kind, including any restraint on a person’s ability to employ another person;

• • • Another bill proposes something that seems to track the Massachusetts approach. Essentially, it follows the fairness and transparency trends harkening back to Oregon’s 2007 change and President Obama’s Call to Action on noncompetes and incorporates many of the additional concepts in the Massachusetts’ 2018 law. For example, it would require noncompetes (and other restrictive covenants) to be signed by both parties and that the employee be told they have a right to consult counsel. It would also prohibit enforcement where employees are let go without cause — though unlike in Massachusetts, it defines those circumstances. And, although it requires companies to provide advance notice that a noncompete will be required, it goes far beyond anything reasonable, requiring a minimum of 30 business days, i.e., about six weeks — even if the employee wants to start immediately. It also imposes fines for failure to comply.
      • In Massachusetts, we had not considered how to handle that situation when we used 10 business days as our standard. Illinois addressed the issue in their 2022 noncompete law, expressly allowing for an employee to waive the notice period. New York, in contrast, doubled down on the mistake of not (expressly) allowing for flexibility.
      • Interestingly, the New York bill would also eliminate no-service/nonaccept agreements (agreements prohibiting employees from accepting business from clients or servicing clients without any solicitation by the employee) and agreements restricting employees from working with former colleagues (whether by use of no-hire agreements or related restrictions).
    • One of the bills proposed by the NYC council follows the FTC’s original approach: noncompete ban, coupled with a requirement to rescind, and a prohibition (probably unconstitutional) on telling an employee that they have a noncompete. It also imposes fines for failure to comply.
    • Another of the NYC bills prohibits noncompetes for “low-wage workers” (meaning “a clerical and other worker as defined in subdivision 7 of section 190 of the labor law”) unless, “at the beginning of the process for hiring such employee, such employer disclosed in writing that they may be subject to such a covenant.”
    • The other pending NYC bill would require employers to pay freelance workers during the noncompete’s restricted period.
    • The two noncompete-adjacent bills deal with B2B no-poach agreements and TRAPs and certain other promissory notes, respectively. 
• North Carolina has one bill. It would prohibit noncompetes for anyone earning less than $75,000 and permit recoupment of attorneys’ fees and enforcement by the attorney general.
• Ohio has one bill. It would ban noncompetes (and forfeiture agreements, TRAPs, and certain other agreements), impose penalties for a violation, and permit enforcement by the attorney general. It also imposes venue and choice of law requirements, which can be avoided if the employee is represented by counsel, but (following a failed California bill from a prior legislative session), the represented-by-a-lawyer-exception would not apply if the employer recommended or paid for the lawyer.
• Oregon has three new bills (and one noncompete-adjacent bill):
  • The first bill would ban noncompetes for certain healthcare professionals.
  • The second bill would prohibit most noncompetes (and nonsolicitation agreements) for certain healthcare professionals.
  • The third bill would limit the use of noncompetes for certain healthcare professionals based on their ownership interest in the entity for which they work.
  • The noncompete-adjacent bill would amend Oregon’s noncompete law to add no-service agreements and no-recruit agreements to the definition of a noncompete and allow for the filing of a complaint with the Commissioner of the Bureau of Labor and Industries. 
• Pennsylvania has one bill. It would prohibit noncompetes in the broadcast industry.
• Rhode Island has two bills:
  • The first bill would ban employee noncompetes.
  • The second bill would prohibit noncompetes for physician assistants.
• South Carolina has two bills:
  • One bill would prohibit nonprofits “located” in South Carolina with an annual gross revenue exceeding one billion dollars from using noncompetes.
  • The other bill would prohibit physician noncompetes (and other restrictive covenants)
• Tennessee has two new noncompete bills (and two noncompete-adjacent bills):
  • The first bill would ban noncompetes.
  • The second bill is the Senate version of the first bill to ban noncompetes.
  • The two noncompete-adjacent bills would affect certain timing requirements for the purchase of a healthcare practice in connection with restrictive covenants.
• Texas has three bills:
  • The first bill would impose limitations on noncompetes for certain healthcare providers.
  • The second bill is the house version of the above bill to impose limitations on noncompetes for certain healthcare providers.
  • The third bill would essentially adopt the FTC’s approach to a ban on noncompetes.
• Utah has (had) one bill. That bill, which has since died, would have imposed limitations on the use of noncompetes for mental healthcare providers.
• Vermont has three bills:
  • The first bill would limit the use of noncompetes for certain healthcare professionals (physicians, advanced practice registered nurses, and physician assistants) based on their ownership interest in the entity for which they work.
  • The second bill would impose a $100,000 wage threshold and, separately, prohibit noncompetes in the franchise context. It would also require the employer to notify affected employees that their noncompete is void and unenforceable.
  • The third bill would ban noncompetes and require the employer to notify affected employees that their noncompete is void and unenforceable.
• Virginia has one bill. If passed — the Governor has until midnight today (March 24, 2025) to decide — the bill would add another category of low-wage workers to Virginia’s existing low-wage exemption. The new one is: an employee “who, regardless of his average weekly earnings, is entitled to overtime compensation under the provisions of 29 U.S.C. § 207 for any hours worked in excess of 40 hours in any one workweek,” i.e., someone who is not exempt under the Fair Labor Standards Act (FLSA).
• Washington has three new (five total) bills:
  • The first bill is the Senate version of the bill discussed below to expand the definition of noncompetes and then ban them and require notification to affected employees.
  • The second bill would add employees let go as part of a mass layoff where the employer failed to comply with certain notice requirements to the circumstances under which a noncompete would be void and unenforceable. 
  • The third bill would prohibit noncompetes for domestic workers, which includes anyone “who works in residences as a nanny, house cleaner, home care worker, cook, gardener, or household manager, or for any domestic service purpose including but not limited to: Caring for a child; providing support services for a person who is sick, convalescing, elderly, or a person with a disability; providing housekeeping or house cleaning services; cooking; providing food or butler services; parking cars; cleaning laundry; gardening; or working as a household manager” — but “does not include: (i) Persons who provide babysitting on a casual labor basis; (ii) Any individual employed in casual labor in or about a 19 private home, unless performed in the course of the hiring entity’s trade, business, or profession; (iii) Individual providers, as defined in RCW 74.39A.240; 22 (iv) Persons who perform house sitting, pet sitting, and dog walking duties that do not involve domestic service; or (v) Any individual in a family relationship with the hiring entity.” 
  • The prior two bills are were follows:
    • One bill would expand the definition of noncompetes and then ban them. It would also require employers to notify employees that their noncompetes (expansively defined) are void and unenforceable.
    • The other bill would prohibit noncompetes for certain domestic workers.

In addition to the above, there are some states with just noncompete-adjacent bills. In particular, California has a bill to prohibit training repayment agreements (TRAPs) and Georgia has a bill to create a committee to study the impacts of physician noncompetes.

Noncompete Legislation in Context

My paralegal, Erika Hahn, and I have been tracking state noncompete legislation at least for the past seven or eight years. As previously explained, contrary to popular belief, noncompete reform did not just become de rigueur because of the FTC’s now-nearly-dead noncompete rule. Rather, noncompete legislation has been au courant for about a decade.

The legislative momentum gained steam following the Jimmy John’s debacle in 2014, the first federal noncompete bills in 2015, and President Obama’s Call to Action on noncompetes in 2016. The FTC’s rule was a late entrant.

For a chronology of the changes in laws before this year, see Changes in noncompete laws since 2011. As will be clear, relatively few changes preceded Jimmy Johns, and then all of the sudden, there was a flurry. Indeed, in the three years before Jimmy John’s, there were only two changes to noncompete laws. In contrast, in the three years after, there were 14. And the momentum has built upon itself over time.

Further, focusing on bills themselves (as opposed to enacted legislation), the FTC’s noncompete rule was issued on April 23, 2024. It was then published on the Federal Register on May 7, 2024, and was set to become effective on September 4, 2024. But in 2023, the year before any of that happened, there were already 98 noncompete bills under consideration in 35 states in 2023. Indeed, the state legislative activity was already at that same level — 98 noncompete bills in 29 states — by 2022, i.e., the year before the FTC even announced its Notice of Proposed Rulemaking to ban noncompetes, which did not happen until January 5, 2023.

And that trend was building on prior years. In 2021, the year we first started keeping the statistics, there were 66 noncompete bills in 26 states.

So, although conventional wisdom is that the momentum to restrict (or ban) noncompetes resulted from the FTC’s activities, that’s not quite right. While the FTC’s noncompete rule certainly got a lot of press attention, it does not appear to have actually affected the quantity of state legislative activity, except perhaps at the margins.

That said, the FTC’s activities have certainly informed some of the dialogue and, in some instances, the specific language.

Further, the focus on training repayment agreements (a/k/a TRAPs and “stay-or-pay agreements”) appears to be a by-product of federal regulatory activity — or perhaps the work of the advocates who were pushing for federal regulation.

* * *

*A huge thank you to Erika Hahn for all of her extraordinary help in tracking and monitoring all of the recent noncompete and trade secret legislative and caselaw developments. And thank you to Leigh Ann Buziak for checking to make sure we had the new Ohio bill and Katheryn Bradley for making sure we knew of the Washington law. As a side note, I have been working on this post for weeks; but just as I neared the end each time, additional bills had been filed. I expect the pace to slow now — though I do expect more bills and more activity on existing bills. 

Firm resources: 

We know how hard it is to keep up with the ever-changing laws and requirements around the country for how you can protect your trade secrets, customer goodwill, and the integrity of your workforce. To help, we have created the resources below (available for free). Each chart is regularly updated to reflect the latest developments. 

	50-State Noncompete Law Chart, the first of its kind and regularly updated (downloadable PDF) (to be updated for the new exemptions in Illinois and Pennsylvania)50-State and Federal Trade Secret Law Chart, providing a comparison of the trade secrets laws nationally to the Uniform Trade Secrets Act (downloadable PDF)
	Chart of Noncompete “Low-Wage” Thresholds and Criteria (downloadable)
	Notice requirements summary chart, providing details for each of the 8 states (plus D.C.) that has notice requirements related to noncompetes (downloadable PDF)
	“Changing Trade Secrets | Noncompete Laws” (dedicated blog page) now provides a current detailed summary of the changing landscape of trade secret laws and noncompete laws around the country, state by state and at the federal level
	Trade secret and other legitimate business interest protection plan strategy and checklist

We hope you find all of these resources useful. More will be coming.

And please note, we are grateful for all of the input we’ve received over the years. We welcome any suggestions for improvements that you may be willing to share.