I took this picture when I went to Ultra Music Festival, Miami in 2019
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As jurisdictions around the country continue to impose limitations—or outright bans—on restrictive covenants, Florida is taking a decidedly different approach. The Florida Contracts Honoring Opportunity, Investment, Confidentiality, and Economic Growth (CHOICE) Act (“the Act”) effective as of July 1, 2025 permits employers to use non-compete and garden leave restrictions up to 4 years in length with qualifying “covered employees,” along with other significant changes. While Florida’s existing law was generally favorable to employers seeking to enforce non-compete restrictions, the Act goes even further, making Florida home to the most restrictive non-compete agreements in the employment context.

An Intentionally Broad Scope

The Act applies to any agreement between “covered employers” and “covered employees,” although the latter is specifically defined as including independent contractors. The scope of the Act is intentionally broad: a “covered employee” is any individual earning or expected to earn a salary greater than twice the annual mean wage of the Florida county (1) in which the employer has its principal place of business or (2) where the employee resides, if the employer’s principal place of business is outside Florida. That annual mean wage threshold does not include anything other than base compensation, and is based on statistics published by the U.S. Department of Labor Bureau of Labor Statistics each year. In 2024, depending on the applicable county, that income threshold would range from roughly $80,000 to just under $150,000. A “covered employer” is simply any person or entity that employs (or, in the case of independent contractors, engages) a “covered employee.” Beyond that salary threshold, the Act further requires any covered agreement (whether a garden leave or non-compete restriction) to:

  1. be expressly governed by Florida law;
  2. advise the employee in writing of their right to seek counsel prior to execution of the agreement;
  3. be provided to the employee at least 7 days before offer of employment expires (for new hires) or before the offer to enter into  the agreement expires (current employees); and
  4. have the employee acknowledge in writing their receipt of confidential information or customer relationships during course of employment.

The Non-Compete/Garden Leave Distinction

The Act addresses two types of restrictions—garden leave agreements and non-compete agreements—with slightly different requirements for each. In a garden leave agreement, the employee is required to give an extended notice period, whereby they remain employed but perform no services. Under the Act, that notice period can now be up to 4 years so long as a covered agreement:

  1. Provides that no services are required from the employee after the first 90 days post-notice;
  2. Expressly allows the employee to engage in nonworking activities, including during  normal business hours, for the non-working portion of the notice period;
  3. Allows the employee, with the permission of the employer, to work for another employer during the non-working portion of the notice period;
  4. Allows for a reduction of the notice period by the employer upon 30 days’ advance written notice; and
  5. Covers the same base salary and benefits that the employee received in the last month before commencement of the notice period (which does not include any discretionary compensation).

The Act’s definition of a covered non-compete, on the other hand, is directed toward traditional post-employment restrictive covenants. Those restrictions can also be up to 4 years in length under the Act but (in addition to the salary and notice requirements set forth above) must provide that the non-compete period is reduced day-for-day by any nonworking portion of a notice period if there is also a garden leave provision in place, i.e. an employer cannot have a 4-year garden leave provision followed by another 4-year noncompete. Moreover, the covered non-compete must expressly be limited to the provision of services that the employee provided in the 3 years prior to termination, or where it is reasonably likely that the employee would use confidential information or customer relationships.

The Act Shifts the Burden on Injunctive Relief

Perhaps the most unique aspect of the Act is the framework it sets forth with regard to injunctive relief. Instead of the typically high bar for a plaintiff employer to qualify for the “extraordinary remedy” of injunctive relief, the Act requires any court, once presented with an application for injunctive relief to stop the breach of a covered agreement, to grant the requested injunction. The burden then shifts to the affected employee: the injunction may only be dissolved or modified if the employee establishes that the (1) the employee will not perform services during the non-compete period that would violate the agreement or that their new employer does not compete with the plaintiff, or (2) that the employer failed to pay the consideration required in the covered agreement (and was given a reasonable opportunity to cure said failure). Notably, the employee must establish as much by a heightened “clear and convincing” standard, and without using any confidential information.[1] Moreover, the Act requires a court to presume that an employee had access to confidential or customer relationships if the employee acknowledged as much in writing, regardless of whether such access actually occurred. The Act provides for fees and costs to be awarded to the prevailing party in any action seeking to enforce an agreement under the Act.

No Effect on Existing Agreements and Exceptions for Healthcare Practitioners

Notably, the Act does not replace or supersede existing Florida law regarding non-competes: if an agreement does not meet the requirements above it is not per se unenforceable, but simply would not be eligible for the enhanced restrictions provided under the Act. The Act does not apply to non-solicitation or confidentiality restrictions, and does not apply to agreements in the context of the sale of a business interest. The Act expressly carves out noncompete and garden leave restrictions on “health care practitioners,” as defined in Florida Stat. § 456.001. That statute, addressed by our colleagues in a prior blog, provides a complicated framework that requires a determination of, among other things, the number of specialists in a particular county as part of enforcement of any non-compete restriction.

Seyfarth Takeaways

So long as a few procedural requirements are obeyed, the Act provides an incredibly powerful tool for Florida employers (or, indeed, any entity employing a Florida resident) to restrict competition after employment, whether through a garden leave clause or a more traditional non-compete provision. The Act’s impact on lawsuits filed to enforce covered agreements will make injunctive relief the norm rather than an extraordinary remedy.

[1] The burden-shifting requirements under the Act apply only to a covered employee. Plaintiffs proceeding under the Act may choose not to seek injunctive relief against an ex-employee’s new employer, considering that this shifted burden likely does not apply to non-parties to the covered agreement in question.

Stethoscope
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In the wake of the Federal Trade Commission’s recently failed attempt to ban non-compete agreements between employers and workers,[1] individual states have once again taken up the mantle of further regulating and limiting their use. These states’ new efforts have appeared with greatest frequency in the health care sector. 

In states where noncompete laws have recently changed, legislatures appear to be working towards striking a balance between the various rights and interests of the affected stakeholders. These rights and interests may include a company’s right to protect its legitimate business interests (such as confidential information, customer relationships, and company goodwill), a health care practitioner’s right to make a living, a community’s interest in maintaining the broadest scope of medical services available, and the interest of patients to maintain continuity of care.

As a result, these new laws have created a kaleidoscope of noncompete restrictions and limitations that will require employer and contractors’ close attention to ensure that arrangements with health care practitioners in any jurisdiction are consistent with governing law. It remains to be seen how these restrictions will distort the market and impact incentives.

Current Patterns in Health Care Non-Competes

Most states permit non-competes in some form.[2] In states where noncompetes are permitted, almost all have general restrictions limiting their scope to reasonable restrictions on geography, time, and job duties. 

The new laws regulating the use of non-competes with medical professionals, however, are much more varied in scope, approach, and enforceability.

Scope

State laws regulating non-compete agreements in health care span the full spectrum – from narrowly covering only licensed physicians[3] and a limited number of other medical professions[4]—often registered nurses—to encompassing up to 28 distinct health care professions.[5]  

Even within statutes applicable only to physicians, distinctions arise based on specialty or who is a party to the agreement. For instance, Tennessee[6] excludes emergency medicine specialists from its non-compete restrictions, while Indiana’s[7] new law, effective July 1, 2025, applies only to agreements between physicians and a hospital or its affiliate.

Diverging Patterns

Together with those states maintaining longstanding prohibitions, certain states have recently adopted a variety of new regulatory models governing noncompetes for health care practitioners:

  1. Blanket Prohibitions: Some states[8] outright void non-compete agreements with select medical professionals, such as Arkansas (effective August 5, 2025), while others[9] like Wyoming’s[10] new law, effective July 1, 2025, void agreements upon termination of employment. Meanwhile, Indiana’s new law was careful to only cover non-competes entered into on or after July 1, 2025, excluding any amendments or renewals made to existing agreements.
  2. Defined Limitations: Other states allow non-competes with medical professionals, but place limitations on what is a “reasonable” duration and geographic scope. Most commonly, a non-compete may last up to 1 year in duration after termination, but non-competes with health care providers in Tennessee[11] may last up to two years. Some states define geographic limitations using fixed political boundaries. For example, Louisiana[12] requires non-competes with physicians to be limited to specific parishes, while Florida’s[13] approach is more complex, requiring an analysis of the number of specialists in a county. Other states impose restrictions based on a defined radius from a practitioner’s primary practice location. For instance, Maryland[14] limits the geographic scope to a ten-mile radius (effective July 1, 2025), Connecticut[15] to 15 miles, and West Virginia[16] to 30 miles with limited exceptions. Most recently, on June 20, 2025, Texas enacted a law limiting the geographic scope to a five-mile radius from the location where the physician primarily practiced before the contract or employment terminated.[17]
  3. Enforceability: Several jurisdictions place conditions on enforceability that hinge on the circumstances surrounding the termination of the agreement. In Indiana[18], for example, non-competes are unenforceable if the physician is terminated without cause, the physician terminates for cause, or the contract expires and the parties have fulfilled the obligations of the contract.  Connecticut[19], on the other hand, conditions enforceability on whether a bona fide renewal offer was made prior to the expiration or whether the termination was for cause. Others place restrictions on buy out provisions.
  4. Hybrid Approach: States such as Maryland take a hybrid approach, marrying compensation thresholds commonly used in generic non-compete laws with medical-specific limitations. Maryland’s[20] law governing non-competes with medical professionals only applies if the professional earns $350,000 or less in annual compensation, must be licensed to practice, and provides direct patient care. Colorado’s[21] upcoming law (effective on August 6, 2025) excludes certain health care providers from general non-compete exemptions, effectively barring such agreements regardless of compensation.

Shifts on the Horizon

Several states are poised to further reshape the medical noncompete landscape:

  • Most recently, on June 20, 2025, Texas[22] enacted a law further limiting the use of non-competes with licensed physicians, which among other requirements, requires agreements to include a buyout cap not to exceed the practitioner’s annual salary and wages. The law takes effect on September 1, 2025, and in addition to physicians, will now cover dentists, certain nurses, and physician assistants.
  • Florida[23] passed a bill in April that was just sent to the governor on June 18, 2025, which expands non-compete limitations to cover employees for longer with a potential larger geographic scope, but interestingly expressly excludes health care practitioners. 
  • On June 11, 2025, the Nevada governor vetoed[24] a bill that would have prohibited non-compete agreements with patient-facing health care providers. It remains to be seen if the veto will be overridden.

Factors Shaping Varying Approaches

This new collection of statutory limitations on medical practitioner noncompete agreements across the country appears to derive from several different factors. First, physicians and other health care professionals often have strong advocacy and lobbying organizations that represent their interests and can assist in bringing their prioritized legislation to the ears of lawmakers in their respective states. This can result in greater protections for health care workers from noncompetes than for other workers and professionals. 

Secondly, the arguments for limiting noncompetes in the health care sector often resonate outside of the economic world of health care practitioners in ways that similar arguments for other workers may not. For example, practitioners’ arguments that they be permitted to continue to provide services in a given market or be permitted to continue serving certain patients are often couched in terms of patient care continuity and the need for a particular community to maintain access to limited health care services. Such advocacy often leads to discussions involving more stakeholders than just the health care employer and employee or contractor.

Thirdly, there remain the legitimate competing interests of the health care employers and contractors, which are similar to those in other fields, but often take on outsized importance in the world of health care. For example, employers may have invested heavily in departing practitioners and provided them with access to the company’s confidential information, customer relationships, specialized training, and company good will. Oftentimes, the training and information relate to cutting edge technologies, given the rapidly evolving state of modern health care. Consequently, employers and contractors with health care professionals may seek to protect that investment by preventing these departing practitioners from going into roles of direct competition where they might unavoidably take advantage of those investments to their former employers’ competitive disadvantage.

Market Impact

Any time a law is passed that limits or permits greater competition, market forces are distorted. Given this mosaic of new laws targeting one key sector of the economy, one that nonetheless impacts every American, we can expect markets distortions to appear, as well as a shift in employer, practitioner, and consumer incentives. 

Moreover, given the complexity of the health care market, these new laws will undoubtedly result in unintended consequences that those passing these laws could not have foreseen. Even as these laws are designed to protect certain interests, they will inevitably impact others in ways that cannot necessary be controlled. In the end, we are likely to see a series of trade-offs, rather than solutions,[25] with the need to revisit many of these laws as their full impact on all affected parties becomes clear.

Conclusion

In conclusion, the regulation of non-compete agreements in the health care sector continues to evolve rapidly at the state level. While some states have adopted comprehensive bans, others have opted for more nuanced frameworks that balance enforceability with public policy considerations. As more states revisit their statutes, the legal landscape is likely to become even more complex, requiring careful attention to jurisdiction-specific requirements.

    Employers and other companies contracting with health care professionals should seek legal guidance regularly and often to ensure their agreements with health care professionals meet state law.

    [1] Appeals challenging the FTC rule are currently stayed.  Ryan v. Fed. Trade Comm’n, No. 24-10951 (5th Circ. Mar. 12, 2025) ECF No. 210 (Granting order to stay appeal for 120 days); Properties of the Villages, Inc. v. Fed. Trade Comm’n,  No. 24-13102 (11th Circ. Mar. 20, 2025) ECF No. 117 (Granting order to stay appeal for 120 days).  Also, on February 14, 2025, the acting NLRB General Counsel rescinded previously issued GC memorandums related to non-competes.  GC 25-05; Rescinded Memos GC 23-08 and GC 25-01.

    [2] With limited exceptions, the following states generally prohibit the use of non-compete agreements: California (Cal. Bus. and Prof. Code §§ 16600 – 16600.5), Minnesota (Minn. Stat. § 181.988), North Dakota (N.D. Cent. Code § 9-08-06), and Oklahoma (Okla. Stat. tit. 15, §§ 217 to 219B).  Colorado also tightly restricts the use of noncompetes and permits them only in limited circumstances such as, e.g., highly compensated workers, the sale of a business, and to protect a company’s trade secrets.  See Colo. Rev. Stat.  § 8-2-113.

    [3] E.g., Delaware (Del. Code tit. 6, § 2707), Florida (Fla. Stat. § 542.336), Louisiana (La. Stat. § 23:921(M – O)), West Virginia (W. Va. Code §§ 47-11E-1 to 5), and Wyoming (S.F. 107 to be codified at Wyo. Stat. § 1-23-108).

    [4] E.g., Colorado (S.B. 83 to be codified at Colo. Rev. Stat. § 8-2-113), Connecticut (Conn. Gen. Stat. §§ 20-14p, 20-101d, and 20-12k), Massachusetts (Mass. Gen. Laws ch. 112, §§ 74D, 12X, 129B, and 135C), and New Hampshire (N.H. Rev. Stat. §§ 315:18, 326-B:45-a, and 329:31-a).

    [5] South Dakota (S.D. Codified Laws §§ 53-9-11 and 53-9-11.2).

    [6] Tenn. Code § 63-1-148(d).

    [7] S.B. 475 amending Ind. Code § 25-22.5-5.5 et seq.

    [8] E.g., Arkansas (Ark. Code § 4‑75‑101), Massachusetts (Mass. Gen. Laws ch. 112, §§ 74D, 12X, 129B, and 135C), New Hampshire (N.H. Rev. Stat. §§ 315:18, 326-B:45-a, and 329:31-a), and Rhode Island (5 R.I. Gen. Laws §§ 5-37-33 and 5-34-50).

    [9] E.g., New Mexico (N.M. Stat. § 24A-4-2) and South Dakota (S.D. Codified Laws §§ 53-9-11 and 53-9-11.2).

    [10] S.F. 107 to be codified at Wyo. Stat. § 1-23-108.

    [11] Tenn. Code § 63-1-148(a)(2).

    [12] La. Stat. § 23:921(M – O).

    [13] Fla. Stat. § 542.336.

    [14] Md. Code, Lab. & Empl. § 3-716(2)(ii).

    [15] Conn. Gen. Stat. §§ 20-14p(b)(2)(A)(ii); 20-101d(b)(2)(A)(ii); and 20-12k(b)(2)(A)(ii).

    [16] W. Va. Code §§ 47-11E-2(a)(2).

    [17] S.B. 1318, 89th Reg. Sess. (Tex. 2025).

    [18] Ind. Code § 25-22.5-5.5-2(b).

    [19] Conn. Gen. Stat. §§ 20-14p(b)(2)(B); 20-101d(b)(2)(B); and 20-12k(b)(2)(B).

    [20] Md. Code, Lab. & Empl. § 3-716(b)(1).

    [21] S.B. 83 to be codified at Colo. Rev. Stat. § 8-2-113.

    [22] S.B. 1318, 89th Reg. Sess. (Tex. 2025)

    [23] H.B. 1219, 127th Leg., Reg. Sess. (Fla. 2025).

    [24] S.B. 378, 83rd Leg., Reg. Sess. (Nev. 2025).

    [25] See Thomas Sowell, A Conflict of Visions: Ideological Origins of Political Struggles.

    adam-thomas-lobgrHEL1GU-unsplash

    Key Takeaways

    • Texas imposes new limits on non-compete agreements with licensed physicians and health care professionals that takes effect September 1, 2025.
    • To be enforceable, non-competes with these individuals must now meet strict geographic and time limitations, have a buyout cap, and use clear contract language.
    • The law reflects a trend toward narrowing or prohibiting non-competes in health care.

    On June 20, 2025, Texas enacted S.B.1318, which limits the scope of non-compete agreements applicable to licensed physicians and now, other “health care professionals.”  The law builds upon existing limitations for non-competes under Texas law, by further narrowing time and geographic limitations for practitioners, and it caps the existing buyout provision at a practitioner’s total annual salary and wages at the time of termination.

    The law only applies to non-competes entered into or renewed on or after September 1, 2025.

    Keys to Enforceability

    The new law applies only to licensed physicians and “health care practitioners,” including dentists, RNs and vocational nurses, and physician assistance.  It excludes administrative roles or those managing or directing care in a non-clinical capacity.

    To be enforceable, non-compete agreements with physicians and health care practitioners must include a –

    • Limited Buyout Cap: Employers must now offer a buyout option that is capped at no more than a practitioner’s total annual salary and wages at the time of termination.   
    • Five-Mile Geographic Restriction: The restricted area must be limited to a five-mile radius from physician’s primary practice location. This sharply narrows the enforceable footprint, potentially preventing employers from imposing broad restrictions to encompass multiple sites.
    • One-Year Maximum Duration: Non-competes must expire no later than one year after the end of employment. 

    All terms and conditions must be stated clearly and conspicuously in writing, reducing ambiguity and strengthening enforceability by ensuring both parties understand their obligations.

    Additionally, non-compete agreements with a physician are automatically void if the physician is involuntarily terminated without “good cause.”  Once in effect, employers must clearly document and justify terminations or else risk losing protections offered by a non-compete agreement.

    From Lone Star to Lockstep

    S.B. 1318 joins at least 15 other states that have enacted limitations on non-competes governing health care professionals. States like Connecticut, Montana, New Mexico, and South Dakota have already enacted broad or profession-specific bans, particularly for physicians, nurses, and other licensed providers.  While Texas stops far short of a full prohibition, its new law signals a shift toward tighter guardrails—balancing legitimate employer interests with those of departing practitioners and the public.

    Locking-In Compliance: Employer Action Items

    • Apply the Law Prospectively: The new requirements only apply to non-competes entered into or renewed on or after the effective date, September 1, 2025, but all future agreements must comply.
    • Update Contract Language: Employers should review formatting, language, and placement of key provisions to ensure compliance and reduce litigation risk. Agreements must clearly and conspicuously state the terms and contain the buyout cap, expiration, five-mile geographic limitation, and continue to provide physicians with access to patient lists, records, and the ability to continue to see patients.
    • Define and Document Primary Practice Location: Employers with multiple sites or regional operations should define what is a “primary practice location” and carefully document primary practice locations in a way that preserves enforceability.  

    To ensure compliance and reduce risk, we recommend reaching out to a Seyfarth attorney for guidance tailored to your organization.

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    Marvin Meyer, Unsplash

    We’re pleased to announce that Seyfarth’s Trading Secrets blog has been named one of FeedSpot’s Top 10 Trade Secrets Blogs.

    Compiled from thousands of blogs, FeedSpot’s list highlights leading sources based on web traffic, social media engagement, domain authority, and content freshness.

    Edited by Dawn Mertineit, Trading Secrets offers timely updates and in-depth analysis on trade secrets, non-compete laws, and computer fraud developments.

    Chambers

    We are pleased to share that Seyfarth partner Dawn Mertineit authored the “USA Trends and Developments” section in the recently released Chambers Trade Secrets Global Practice Guide. This highly regarded publication provides timely insights and analysis on the evolving legal landscape of trade secrets law across the globe.

    Dawn addresses the growing challenges businesses face in protecting their trade secrets amid rapid technological change and increasing legal limitations on the use of restrictive covenants. She emphasizes the need for companies to stay proactive in reviewing and revising their agreements to ensure compliance with shifting federal and state laws, as well as judicial trends.

    As courts and legislators across the U.S. continue to scrutinize non-compete and non-solicitation agreements, the importance of trade secret protection has never been greater. Dawn’s contribution offers practical guidance for companies looking to fortify their competitive edge in this changing environment.

    For those navigating the complexities of trade secret protection and restrictive covenant enforcement, the Chambers Trade Secrets Global Practice Guide is an essential resource.

    Read the full guide here.

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    With the FTC Ban on non-competes essentially dead in the Courts of Appeal, various states and agencies have taken up the mantle to further limit or expand the use of restrictive covenants for certain populations in 2025. 

    Below is a list of major legislative changes, judicial decisions, and agency actions at the state and federal level affecting non-compete agreements in the first four months of 2025.

    KEY TAKEAWAYS

    1. Compensation thresholds continue to shift, with states like Colorado, D.C., Maine, and Washington updating eligibility levels.
    2. Healthcare remains a focus: several states are restricting non-competes for physicians, nurses, and other providers.
    3. States are moving faster than federal agencies, creating a patchwork of evolving standards.
    4. Employers should proactively audit existing agreements for compliance and consult legal counsel before enforcement.

    STATE LEGISLATIVE DEVELOPMENTS

    Arkansas

    • On March 4, 2025, Arkansas amended its non-compete law to prohibit and void non-compete agreements that restrict the right of a physician to practice within their field.  The law takes effect 90 days after the legislative session ends (May 5, 2025).  (S.B. 139 [arkleg.state.ar.us]; Eff. est. 8/3/25)

    Colorado

    • Colorado updated the highly compensated employee threshold: non-competes may only be entered into with employees earning $127,091 or more and covenants not to solicit customers may only be entered into with an employee earning approx. $76,254.60.  (7 CCR 1103-14 [cdle.colorado.gov]; Eff. 1/1/25)
    • On April 21, 2025, the Colorado legislature passed a bill that excludes certain doctors, dentists, and nurses from the highly compensated workers exemption to the state’s non-compete and customer non-solicitation laws. Covered healthcare providers may not be prohibited from disclosing their new professional contact information to their patients.  Also, the bill allows a non-compete agreement to include the recovery of certain recruiting expenses (e.g., relocation expenses, signing bonuses), so long as the employer’s recovery decreases proportionally over the course of not more than 3 years.  Colorado’s Governor has not signed the bill, but if enacted, it will take effect 90 days after adjournment of the legislative session on August 6, 2025.  (S.B. 83)

    District of Columbia

    • In early February 2025, the Consumer Price Index for the Washington D.C. Metro area dropped from 2.8% to 2.7%.  Consequently, restrictions on non-compete clauses now apply to employees who earn $158,364 or less and medical specialists earning $263,939 or less.  (Index [bls.gov]; Update [does.dc.gov]; Eff. 1/1/25)

    Florida

    • On April 24, 2025, the Florida legislature passed a bill governing non-compete agreements between employers and “covered employees,” defined as individuals, other than health care practitioners, earning a salary greater than twice the annual mean wage for their respective county. “Covered non-competes agreements” between covered employees and their employers will be required to be in writing, last no longer than 4 years, and the agreement must define the geographic area in which the employee agrees not to provide services similar to those provided to the employer during the preceding 3 years or in a role in which it is reasonably likely that the employee would use confidential information or customer relationships of the employer.  If the bill is signed into law, it will take effect on July 1, 2025.  (H.B. 1219 [flsenate.gov])

    Illinois

    • Non-compete and non-solicitation provisions entered into after January 1, 2025 are unenforceable if the provision is likely to result in an increase in cost or difficulty for any veteran or first responder seeking mental health services from a mental health professional licensed in Illinois.  Effective February 7, 2025, Illinois enacted a law that revises the definition of “first responder” to include persons formerly employed as emergency medical services personnel, firefighters, and law enforcement officers. (S.B. 2737 [ilga.gov]; H.B. 2840 [ilga.gov]; Eff. 1/1/25 and 2/7/25)
    • Non-competes and non-solicitation agreements with a person employed in construction are void and illegal, regardless of whether the employee is covered by a collective bargaining agreement.  (S.B. 2770 [ilga.gov]; Eff. 1/1/25)

    Kansas

    • On April 8, 2025, Kansas enacted a law amending its restraint of trade statute.  The amended law (1) directs the judiciary to modify contracts that are overbroad or otherwise not reasonably necessary to protect a business’s business interest, and grant only the relief reasonably necessary to protect such interests; (2) creates a presumption of enforceability for written non-solicitation agreements between a business owner and a business entity, including employee and material contact customer non-solicitation agreements, that does not last more than four years following the end of the owner’s business relationship with the business entity; and (3) creates a presumption of enforceability for written non-solicitation agreements with employees that lasts no more than 2 years following employment, if the agreements prohibit either (a) solicitation of employees, if it seeks to protect trade secrets or customer or supplier relationships, goodwill, or loyalty or (b) solicitation of material contact customers.  (S.B. 241 [kslegislature.gov]; Eff. 7/1/25)

    Louisiana

    • Louisiana added restrictions to non-compete agreements with physicians that limit their ability to practice medicine, excluding certain physicians in rural hospitals or under certain federal contracts in rural parishes.  Non-competes with primary care physicians may not exceed 3 years, or 5 years for all other physicians, beginning from the effective date of the initial contract.  Agreements must include qualified parish-specific geographic limitations, and subsequent agreements between the employer and physician executed after the initial restricted period may not contain a non-compete provision.  (S.B. 165 [legis.la.gov]; Eff. 1/1/25)

    Maine

    • The non-compete threshold was updated: employers may not enter into a non-compete agreement with an employee earning at or below $62,600 per year, which is based on the 2025 Poverty Guidelines published on January 15, 2025.  (HHS Poverty Guidelines [aspe.hhs.gov]; Eff. 1/1/25)

    Maryland

    • Effective June 1, 2024, Maryland expanded its non-compete statute to prohibit non-compete agreements with healthcare providers who provide direct care to patients and earn $350,000 or less in annual compensation, as well as veterinary practitioners and technicians.  Noncompete and conflict of interest provision for those covered under the exemption may not exceed one year and a ten mile radius.  The prohibition applies to agreements executed on or after July 1, 2025.  (H.B. 1388 [mgaleg.maryland.gov])

    Montana

    • On April 16, 2025, Montana amended its non-compete law, expanding its prohibition on non-competes to include naturopathic physicians, registered nurses, advance practiced nurses, and physician assistants.  (H.B. 198 [bills.legmt.gov]; Eff. 4/16/25)

    Oregon

    • In late January 2025, Oregon increased the salary threshold for non-compete agreements from $113,241 to $116,427.  (Announcement [oregon.gov]; Eff. 1/1/25)

    Pennsylvania

    • Pennsylvania prohibits non-competes with health care practitioners entered into after January 1, 2025.  Non-compete covenants are defined as agreements between employers and health care practitioners that have the effect of impeding the health care practitioners’ ability to continue treating patients or accepting new patients, either independently or with a competing employer.  Patients with an ongoing relationship with the practitioner of 2 or more years must be notified of their practitioner’s departure within 30 days.  (H.B. 1633 [legis.state.pa.us]; Eff. 1/1/25)

    Rhode Island

    • The non-compete threshold for low-wage employees is increased to $39,125, which is based on the 2025 Poverty Guidelines published on January 15, 2025.  (Poverty Guidelines [aspe.hhs.gov]; Eff. 1/1/25)

    Virginia

    • Virginia updated its average weekly wage for 2025 to $1,463.10.  Employers are prohibited from entering into non-compete agreements with “low wage employees” (including independent contractors) earning less than $1,463.10 per week.  (Announcement [doli.virginia.gov]; Eff. 1/1/25)
    • On March 24, 2025, Virginia  enacted a law that expands the definition of “low wage worker” under its non-compete law to include any person, regardless of weekly earnings, who is entitled to overtime under federal law for working in excess of 40 hours per week.  The bill does not apply to agreements entered into or renewed prior to July 1, 2025.  (S.B. 1218 [lis.virginia.gov]; Eff. 7/1/25)

    Washington

    Wyoming

    • On March 19, 2025, Wyoming enacted a law that voids non-compete agreements entered into on or after July 1, 2025, unless it relates to (1) executive and management personnel, their professional staff, and officers; (2) rights of a physician to practice medicine upon termination; (3) recovering qualified expenses related to relocating, education, and training; (4) the sale of a business/asset; and (5) trade secret protections.  Physicians may share their new contact information to existing patients with a rare disorder.  (S.F. 107 [wyoleg.gov]; Eff. 7/1/25)

    FEDERAL AND JUDICIAL DEVELOPMENTS

    U.S. Court of Appeals in the Seventh Circuit

    • On January 22, 2025, the 7th Circ. held that courts do not review forfeiture-for-competition provisions for reasonableness if the employee voluntarily terminated their employment.  (LKQ Corp. v. Rutledge [media.ca7.uscourts.gov])

    Washington Supreme Court

    • On January 23, 2025, the Washington State Supreme Court held that the state of Washington’s moonlighting law protects employees who earn less than twice the state minimum wage from unreasonable restrictions on obtaining supplemental employment, and permits employers to impose only narrow restrictions consistent with the employee’s duty of loyalty. Consequently, a non-compete agreement with a low-wage worker cannot bar employees from providing both direct and indirect assistance to competitors.  (David and Springer v. Freedom Vans, LLC. [courts.wa.gov]; Seyfarth Post)

    NLRB

    FTC

    • On February 26, 2025, the FTC announced that it created a joint task force that will focus on rooting out and prosecuting anti-competitive labor practices, including the use of non-competes, no poach, no-solicitation, and no-hire agreements.  (Announcement [ftc.gov]; Seyfarth Post)

    Stay tuned for continued developments as the legal landscape for restrictive covenants continues to evolve throughout 2025.

    Cyber security image
    FlyD, Unsplash

    2025 Trade Secrets Webinar Series

    REGISTER HERE

    Thursday, May 1, 2025
    1:00 p.m. to 2:00 p.m. Eastern
    12:00 p.m. to 1:00 p.m. Central
    11:00 a.m. to 12:00 p.m. Mountain
    10:00 a.m. to 11:00 a.m. Pacific

    About the Program

    In today’s always-online world, a single social media post, GitHub upload, or Slack message can put millions of dollars in proprietary data at risk.

    Join Seyfarth’s Trade Secrets team for our next webinar in the 2025 Trade Secrets Webinar Series, where we’ll explore how digital platforms—from LinkedIn to messaging apps—can become high-risk zones for trade secret exposure.

    This session will cover:

    • Common ways trade secrets are inadvertently leaked online
    • How to proactively train and guide employees on safe digital practices
    • Key policy, monitoring, and enforcement strategies for protecting IP
    • Practical steps to take when a potential disclosure occurs
    • Legal implications and what recent cases are telling us

    This webinar is designed for in-house counsel, business leaders, and professionals overseeing trade secret protection, AI innovation, and intellectual property strategy.

    Speakers

    Kevin Mahoney, Partner, Seyfarth Shaw LLP
    Mitch Robinson, Senior Counsel, Seyfarth Shaw LLP
    Andrew Saxon, Senior Counsel, Seyfarth Shaw LLP

    REGISTER HERE

    If you have any questions, please contact Sela Sofferman at ssofferman@seyfarth.com and reference this event.

    To comply with State CLE Requirements, CLE forms requesting credit in IL or CA must be received before the end of the month in which the program took place. Credit will not be issued for forms received after such date. For all other jurisdictions forms must be submitted within 10 business days of the program taking place or we will not be able to process the request.

    Our live programming is accredited for CLE in CA, IL, and NY (for both newly admitted and experienced).  Credit will be applied as requested, but cannot be guaranteed for TX, NJ, GA, NC and WA. The following jurisdictions may accept reciprocal credit with our accredited states, and individuals can use the certificate they receive to gain CLE credit therein: AZ, AR, CT, HI and ME. For all other jurisdictions, a general certificate of attendance and the necessary materials will be issued that can be used for self-application. CLE decisions are made by each local board, and can take up to 12 weeks to process. If you have questions about jurisdictions, please email CLE@seyfarth.com.

    Please note that programming under 60 minutes of CLE content is not eligible for credit in GA. programs that are not open to the public are not eligible for credit in NC.

    Sometimes you just have to look up.
    Joshua Sortino, Unsplash

    Tuesday, May 6, 2025
    1:00 p.m. to 2:00 p.m. Eastern
    12:00 p.m. to 1:00 p.m. Central
    11:00 a.m. to 12:00 p.m. Mountain
    10:00 a.m. to 11:00 a.m. Pacific

    Register Here

    About the Program

    Join us for the third and final session of our Commercial Litigation Outlook webinar series, where we’ll examine key legal trends shaping the future of trade secrets, non-compete agreements, eDiscovery, and data privacy. This session will deliver practical insights into regulatory changes, litigation risks, and compliance strategies across these dynamic areas.

    Key topics include:

    • Non-Compete Enforcement in Flux: Analyze shifting federal and state approaches to non-compete agreements, including the uncertain fate of the FTC’s proposed ban, ongoing legal challenges, and increased scrutiny in jurisdictions like California, Minnesota, and Delaware.
    • Prioritizing Trade Secret Protection: As non-compete agreements face greater limitations, discover how businesses can strengthen trade secret defenses through enhanced protocols, documentation, and technology—especially in the context of emerging AI-related risks.
    • GenAI’s Impact on eDiscovery: Explore how generative AI is transforming discovery workflows, prompting new expectations around transparency, defensibility, and the protection of work product—guided by recent case law and evolving ESI standards.
    • Litigating AI-Generated Evidence: Delve into the challenges posed by deepfakes and synthetic content, from authentication concerns to rising litigation costs, and the importance of proactive detection and preservation protocols.
    • Privacy Litigation on the Rise: Examine how evolving statutes such as CCPA, CIPA, and BIPA are being used to contest companies’ use of tracking technologies, biometric tools, and connected devices—and how courts are addressing harm and standing.
    • Managing Emerging Privacy Risks: Gain insight into the growing legal exposure tied to telematics, algorithmic decision-making, and sensitive health data—and explore proactive mitigation strategies like privacy audits, enhanced disclosures, and vendor oversight.

    Speakers

    Moderator:

    Rebecca Woods, Partner, Seyfarth Shaw LLP

    Panelists:

    Dawn Mertineit, Partner, Seyfarth Shaw LLP
    Jay Carle, Partner, Seyfarth Shaw LLP
    Matthew Christoff, Partner, Seyfarth Shaw LLP
    Jason Priebe, Partner and Associate General Counsel, Seyfarth Shaw LLP

    Register Here

    If you have any questions, please contact Sadie Jay at sjay@seyfarth.com and reference this event.

    Learn more about our Commercial Litigation practice. To comply with State CLE Requirements, CLE forms requesting credit in IL or CA must be received before the end of the month in which the program took place. Credit will not be issued for forms received after such date. For all other jurisdictions forms must be submitted within 10 business days of the program taking place or we will not be able to process the request.

    Our live programming is accredited for CLE in CA, IL, and NY (for both newly admitted and experienced).  Credit will be applied as requested, but cannot be guaranteed for TX, NJ, GA, NC and WA. The following jurisdictions may accept reciprocal credit with our accredited states, and individuals can use the certificate they receive to gain CLE credit therein: AZ, AR, CT, HI and ME. For all other jurisdictions, a general certificate of attendance and the necessary materials will be issued that can be used for self-application. CLE decisions are made by each local board, and can take up to 12 weeks to process. If you have questions about jurisdictions, please email CLE@seyfarth.com.

    Please note that programming under 60 minutes of CLE content is not eligible for credit in GA. programs that are not open to the public are not eligible for credit in NC.

    1744302968-13194-8612-lxb_photoWmFnT03yrZElxb_photo-
    Joe Pee, Unsplash

    Wyoming, with the introduction of Wyo. Stat. §1-23-108, banned most non-compete agreements for contracts signed on or after July 1, 2025, but with several meaningful exceptions. If you do business in Wyoming, here’s what you need to know:

    Key Exceptions to the Ban

    While the majority of non-compete agreements will be unenforceable, Wyoming’s new statute carves out several exceptions:

    1. High-Level Employees: Non-compete agreements can still apply to “executive and management personnel” and their professional staff. However, the law does not define these terms, leaving employers (and the courts) to assess which roles fall under this category.
    2. Sale-of-Business Agreements: When a business is sold or transferred, the buyer and seller can negotiate non-compete clauses. This provision ensures that buyers can safeguard the value of their investment.
    3. Trade Secrets: A non-compete agreement will be valid to the “extent the covenant provides for the protection of trade secrets as defined by W.S. §6-3-501(a)(xi).”
    4. Recovery of Expenses: Employers may require employees to repay training, education, or relocation costs if they leave within four years of their employment (a so-called “TRAP” agreement). Repayment percentages are tiered as follows:
      • Up to 100% if employment lasts less than two years.
      • Up to 66% for employment between two and three years.
      • Up to 33% for employment between three and four years.

    Special Protections for Physicians

    Non-compete agreements with physicians are prohibited outright. Additionally, doctors with patients who have rare disorders can inform them of their new practice location and contact details, ensuring continuity of care, with no fear of liability to the physician or any new employer.

    What This Means for Wyoming Employers

    The new statute applies prospectively to agreements signed on or after July 1, 2025. Employers should work with legal counsel prior to July 1, 2025 to ensure compliance, especially when defining roles for high-level employees, safeguarding trade secrets, or structuring repayment agreements for employee training, education and relocation costs.

    1742249833-13190-8877-lxb_photoGJao3ZTX9gUlxb_photo-
    Cytonn Photography, Unsplash

    In our recent webinar, “Drafting Restrictive Covenants That Work – Insights from Recent Legal Battles,” Seyfarth’s Trade Secrets, Computer Fraud & Non-Compete partners Dawn Mertineit and Dallin Wilson explored the evolving legal landscape surrounding restrictive covenants. As courts and lawmakers continue to scrutinize non-competes, non-solicits, and NDAs, employers must adapt their agreements to remain enforceable while protecting critical business interests. The session provided key insights into judicial trends, legislative updates, and best practices for drafting enforceable restrictive covenants.

    Key Takeaways from the Webinar

    • The legal landscape is shifting rapidly. Courts and legislatures are continually reshaping restrictive covenant law, requiring employers to stay informed and update their agreements accordingly.
    • Broad restrictive covenants are facing more judicial resistance. Many courts now refuse to narrow overbroad agreements, meaning employers should carefully draft restrictions to be no broader than necessary to protect legitimate business interests.
    • Jurisdiction matters. States are increasingly imposing venue and choice-of-law restrictions, making it more difficult for employers to enforce restrictive covenants in their preferred jurisdictions. Businesses should strategically consider where enforcement will be most effective.

    Missed the live session? Click here to watch the full webinar recording.