Are non-compete agreements enforceable in Minnesota?
1. Baseline Rule. Minn. Stat. § 181.988 (effective July 1, 2023) declares "covenants not to compete are void and unenforceable" except in narrow situations. Minnesota joined California, North Dakota, and Oklahoma as no-non-compete states.
2. Permitted Categories. The ban does NOT apply to (a) sale-of-business covenants where the employee/seller receives consideration; or (b) covenants entered into in anticipation of dissolution of a business.
3. Pre-7/1/2023 Covenants. Covenants signed before July 1, 2023, remain enforceable under prior common law if reasonable in time, geography, and scope, and supported by independent consideration if signed mid-employment. Kallok v. Medtronic, Inc., 573 N.W.2d 356 (Minn. 1998), and Davies & Davies Agency v. Davies, 298 N.W.2d 127 (Minn. 1980), govern.
4. Wage Thresholds. Not applicable — the ban is categorical for covered employees.
5. Blue Pencil / Reformation. Irrelevant for post-7/1/2023 covenants — they are void. Pre-7/1/2023 covenants may be reformed under prior law.
6. Permitted Restraints. Confidentiality agreements, customer non-solicits, employee non-solicits, and trade-secret protections remain enforceable under common law and the Minnesota Trade Secrets Act (Minn. Stat. §§ 325C.01-08).
7. Industry Carve-Outs. Lawyers barred by Minn. RPC 5.6. Physicians and broadcasters covered by the general ban.
8. FTC Rule. Enjoined nationwide by Ryan LLC v. FTC (E.D. Tex. Aug. 2024); on appeal. Minnesota law continues to govern.
9. Choice of Law / Forum. Minn. Stat. § 181.988(3) voids any provision that requires a Minnesota employee to adjudicate under another state's law or in another state's courts.
10. Remedies. Employees may seek injunctive relief, costs, disbursements, and reasonable attorneys' fees against an employer attempting to enforce a void non-compete.
This is legal information, not legal advice.
- You signed a non-compete before July 1, 2023, and the employer seeks to enforce
- Employer demands you sign a Florida or Delaware choice-of-law clause
- Employer attempts to recast a non-compete as a customer non-solicit
- Minn. Stat. § 181.988
- Kallok v. Medtronic, Inc., 573 N.W.2d 356 (Minn. 1998)
- Minn. Stat. §§ 325C.01-08 (Minnesota Trade Secrets Act)
This is legal information, not legal advice. Laws vary by jurisdiction and change frequently. Always verify current law with official sources and consult a licensed attorney in your jurisdiction for advice on your specific situation.