Are Non-Compete Agreements Still Enforceable in Minnesota?

Minnesota significantly changed its non-compete law in 2023. Under the statute, most non-compete agreements entered into on or after July 1, 2023 are void and unenforceable. The law defines a “covenant not to compete” as an agreement that restricts an employee, after leaving employment, from working for another employer, working in a geographic area, or working in a similar role. See Minn. Stat. § 181.988.

The new law was designed to make it easier for employees to change jobs without fear of legal threats from former employers. But the statute does not prohibit every type of post-employment restriction. Employers may still require agreements protecting confidential information, trade secrets, or client relationships, such as non-solicitation provisions.

The law also prevents employers from requiring Minnesota employees to litigate employment disputes outside Minnesota or under another state’s law as a condition of employment. This protection applies to employees who primarily live and work in Minnesota. See Minn. Stat. § 181.988, subd. 3.

Even with the new statute, questions about enforceability still arise. The answer may depend on when the agreement was signed, how it is written, and whether it is truly a non-compete or another type of restriction. If you have questions about a noncompete agreement, contact us today.