Noncompete Agreements by State: 2026 Bans, Salary Thresholds and New Laws

Last updated: 11 November 2026. This guide uses state statutes and agency figures (Washington Department of Labor & Industries, Oregon BOLI, Colorado’s 2026 PAY CALC Order, DC Department of Employment Services), Federal Trade Commission records, enacted bill summaries and law firm analyses of 2025 and 2026 legislation, plus the UK government’s working paper on non-compete reform. Pay thresholds are 2026 figures unless stated.

Short answer: There is still no federal noncompete ban in the US. The FTC’s 2024 rule was set aside in court and formally removed in February 2026. Four states ban most noncompetes outright (California, Minnesota, North Dakota and Oklahoma), Wyoming bans most since July 2025, Washington will join them in June 2027, and about a dozen others bar them below a pay threshold.

Key takeaways

• California, Minnesota, North Dakota and Oklahoma void most employee noncompetes. Wyoming has done so since 1 July 2025, with exceptions for executives and management staff.
• Washington signed a near-total ban on 23 March 2026 that takes effect on 30 June 2027 and applies to existing agreements too.
• Pay thresholds rose for 2026: $126,858.83 in Washington, $130,014 in Colorado, $119,541 in Oregon and $162,164 in DC. Tennessee added a $70,000 floor from 1 July 2026.
• The FTC dropped its appeal in September 2025 and now challenges noncompetes case by case, including an April 2026 order covering more than 18,000 Rollins employees.

Is there a federal ban on noncompete agreements?

No. The Federal Trade Commission adopted a rule in 2024 that would have banned most worker noncompetes nationwide. In Ryan LLC v. FTC, a federal judge in the Northern District of Texas set the rule aside in August 2024, before it took effect. In September 2025 the Commission voted 3 to 1 to drop its appeals and accept that decision. On 12 February 2026 it published a notice in the Federal Register removing the rule from the Code of Federal Regulations.

The FTC has not given up on noncompetes. It now brings individual cases under Section 5 of the FTC Act, which bars unfair methods of competition. Its noncompete enforcement page lists:

• Gateway Services, a pet cremation company, which agreed in September 2025 to stop enforcing noncompetes that covered almost all its staff, about 1,800 people. The order became final in November 2025.
• Warning letters sent in September 2025 to health care employers and staffing firms.
• A public workshop on noncompetes on 27 January 2026.
• Rollins, the pest control group, ordered in April 2026 to stop enforcing noncompetes against more than 18,000 employees. The order was finalised on 22 June 2026.
• A warning letter from Chairman Andrew Ferguson to Mortgage Connect in May 2026.

Commissioner Rebecca Slaughter dissented from the 2025 decision to drop the appeals. Her position on the Commission was itself tested in the Supreme Court, which we explain in Trump v. Slaughter and the end of Humphrey’s Executor.

Which states ban noncompete agreements?

Five states now void most employee noncompetes regardless of pay, and a sixth has a ban on the way.

• California. Business and Professions Code section 16600 voids contracts that restrain anyone from a lawful profession. Since 2024 employers also may not enforce a void noncompete signed outside California, and were required to tell affected employees that such clauses are void.
• Minnesota. Noncompetes signed on or after 1 July 2023 are void under Minnesota Statutes section 181.988, with exceptions for the sale or dissolution of a business.
• North Dakota. Century Code section 9-08-06 voids restraints on a lawful profession, with exceptions for the sale of goodwill and partnership dissolution.
• Oklahoma. Noncompetes are void, but a former employee can be barred from directly soliciting the employer’s established customers.
• Wyoming. Under SF 107, noncompetes entered on or after 1 July 2025 are void, except in the sale of a business, to protect trade secrets, to recover relocation, education and training costs, and for executive and management personnel and their professional staff. Physician noncompetes are void.
• Washington (from 30 June 2027). ESHB 1155, signed on 23 March 2026, voids virtually all noncompetes whenever they were signed. Customer nonsolicitation clauses of up to 18 months remain allowed, as do sale-of-business covenants for owners of 1% or more. Employers must make reasonable efforts to tell current and former workers in writing by 1 October 2027 that their noncompetes are void.

Which states use salary thresholds, and what are the 2026 figures?

A larger group allows noncompetes only for workers above a pay floor, or bars them for non-exempt (hourly or overtime-eligible) staff. Several figures are indexed and change on 1 January each year. Washington publishes its numbers on the Department of Labor & Industries site, Oregon on the BOLI noncompetition page and DC in a 2026 DOES notice. Colorado’s figure comes from its 2026 PAY CALC Order.

Noncompete agreements by state: the 2026 table

Thresholds are per year unless stated. Maine, Rhode Island and Virginia dollar figures are derived from federal poverty guidelines or the state average weekly wage and should be checked against the latest official notice before you rely on them.

What new noncompete laws passed in 2025 and 2026?

The trend is clear: more limits, aimed first at health care and lower-paid staff, with Florida the main exception.

• Washington (2026). The near-total ban described above. It also treats forfeiture-for-competition terms, which can reach bonuses and equity, as noncompetes.
• Tennessee (2026). HB 1034, signed on 7 May 2026, bars noncompetes for employees earning under $70,000 a year from 1 July 2026. Restraints of two years or less are presumed reasonable, or up to five years in a business sale.
• Virginia (2025 and 2026). From 1 July 2025 the ban covers all non-exempt employees, not just low earners. SB 170, signed in April 2026, stops employers enforcing a noncompete against someone dismissed without cause unless severance or another payment was disclosed when the covenant was signed. Separate 2026 laws restrict noncompetes for certain health care professionals and in retail franchises.
• Wyoming (2025). The broad ban with executive and management exceptions.
• Florida (2025). The CHOICE Act goes the other way. For workers earning more than twice the annual mean wage of the relevant county, it supports noncompetes of up to four years and paid garden leave of up to four years. In specified cases the worker must be given 7 days to review the agreement before signing.
• Health care. Texas SB 1318 (September 2025) caps buyouts at a year’s pay and limits restrictions to one year and five miles for physicians, dentists, physician assistants and nurses. Arkansas voided physician noncompetes in 2025. Utah, Maine and New Hampshire added health care restrictions in 2026, and Pennsylvania’s law for health care practitioners has applied since 1 January 2025.

Bills failed in 2026 in Connecticut, Hawaii, Kansas, Mississippi, Minnesota and Wisconsin, among others, and proposals were still pending in states including New York, Ohio, Massachusetts and New Jersey.

What should employers and employees check now?

• Which state’s law applies. Look at where the worker lives and works, not just the choice-of-law clause. California and Washington limit attempts to apply another state’s law.
• Pay on the date that counts. Some thresholds apply at signing, others at termination (Oregon), and several change every January.
• Notice and review periods. Illinois requires 14 days and advice to consult a lawyer; Oregon requires notice in the written job offer; Florida’s CHOICE Act requires a 7-day review period.
• Whether a narrower clause will do. A confidentiality agreement or customer non-solicit is often enforceable where a noncompete is not. Our explainer on how NDAs work covers the alternatives, and our non-compete and non-solicitation template and employment agreement template show typical drafting. Any template needs checking against the state rules above.

What is happening with non-competes in the UK?

In England and Wales a non-compete is unenforceable as a restraint of trade unless it protects a legitimate business interest and goes no further than reasonably necessary. There is no statutory cap yet.

That may change. The Department for Business and Trade published a working paper on reforming non-compete clauses on 26 November 2025, which closed on 18 February 2026. Law firm summaries of the paper list five options: a statutory limit on length, limits that vary with company size, an outright ban, a ban below a salary threshold, or a salary threshold combined with a three-month cap. In October 2026, Prime Minister Andy Burnham said the government would legislate, and the Autumn Budget 2026 confirmed reform across the whole economy, with detailed proposals expected in early 2027. Employers tracking UK changes should also follow the Employment Rights Act 2025 timeline, which is reshaping other parts of the employment relationship.

Frequently asked questions

Are noncompete agreements legal in the US in 2026?

Yes, in most states, if they are reasonable in length, area and scope and protect a legitimate business interest. California, Minnesota, North Dakota, Oklahoma and Wyoming void most of them, and many other states ban them below a pay threshold.

Did the FTC ban noncompetes?

It tried. The 2024 rule was set aside in Ryan LLC v. FTC in August 2024, the FTC dropped its appeals in September 2025 and it removed the rule in February 2026. It now brings individual enforcement cases instead.

What is the noncompete salary threshold in Washington for 2026?

$126,858.83 for employees and $317,147.09 for independent contractors. From 30 June 2027 almost all noncompetes in Washington will be void regardless of pay.

Which states banned noncompetes most recently?

Minnesota banned them from 1 July 2023 and Wyoming from 1 July 2025, with exceptions. Washington’s near-total ban, signed in March 2026, takes effect on 30 June 2027.

Can an employer enforce a noncompete if I am fired?

It depends on the state. In Virginia, from 1 July 2026, an employer cannot enforce one against an employee dismissed without cause unless severance or another payment was disclosed at signing. In many other states, being fired does not by itself void the clause.

Is the UK banning non-compete clauses?

The government has said it will legislate to restrict them across the economy, but the detail is not expected until early 2027. Options under review include a three-month cap and a ban below a salary threshold.

This guide is general information about US state law, federal enforcement and UK proposals as of 11 November 2026. It is not legal advice. Noncompete rules change often and depend on the facts, so employers and employees should speak to an employment lawyer in the relevant state or country before signing, drafting or challenging a restrictive covenant.