Non-Compete Clauses: What to Look For

What a non-compete actually restricts

A non-compete typically prevents you from working for competitors or starting a competing business for a defined period after your relationship ends. Related clauses — non-solicitation (can't recruit colleagues or clients) and non-disclosure (can't share confidential info) — are separate restrictions with different rules.

The three scope questions

Courts evaluate non-competes on three dimensions: duration (how long), geography (where), and scope of activity (what kind of work). A 6-month restriction with direct competitors in your city is very different from a 3-year nationwide ban on your entire profession.

• Duration: 6–12 months is common; 2+ years raises enforceability questions in many states
• Geography: Should match where the employer actually operates — not "worldwide"
• Scope: Should describe specific competing activities — not your entire profession

State law matters enormously

California generally prohibits non-competes for employees. Minnesota, Oklahoma, and North Dakota have similar restrictions. Other states enforce reasonable non-competes. The FTC proposed a nationwide ban (currently in legal flux as of 2025). Always check your state's current rules — a clause that's standard in one state may be void in another.

How to negotiate a narrower non-compete

Employers often start with overbroad language expecting negotiation. Reasonable asks: limit duration to 12 months, restrict geography to the metro area where you worked, narrow scope to direct competitors in the same product category, and add a carve-out for passive investments or advisory roles without operational involvement.

Non-compete vs. non-solicit vs. NDA

These three clauses are often bundled together but do different things. An NDA protects confidential information — generally enforceable if reasonable. A non-solicit restricts poaching clients or employees — moderately enforceable. A non-compete restricts your ability to earn a living — most heavily scrutinized by courts.