Non-Compete Laws in Minnesota
Not enforceable
Minnesota bans non-compete agreements for all employees, including independent contractors. The ban took effect July 1, 2023. Non-competes are only permitted in connection with the dissolution or sale of a business.
Key details
| Enforceability | Not enforceable |
|---|---|
| Blue pencil doctrine | No |
| Key statute | Minn. Stat. §181.988 |
Recent changes
The ban took effect July 1, 2023 and applies to all agreements entered into on or after that date. It does not apply retroactively to agreements signed before July 1, 2023. Note: proposed legislation in 2025 would allow limited non-competes for high earners, but has not passed as of March 2026.
Exceptions and special circumstances
Non-competes are only permitted in connection with the dissolution or sale of a business.
What this means for you
If you signed a non-compete on or after July 1, 2023, it is void. Non-competes signed before that date may still be enforceable. The ban does not cover non-disclosure or non-solicitation agreements.
Non-compete laws in Minnesota: what you need to know
Minnesota banned non-compete agreements for all employees and independent contractors effective July 1, 2023, becoming one of the most recent states to enact a comprehensive prohibition. The law applies to any agreement entered into on or after that date, meaning non-competes signed before July 1, 2023, may still be enforceable. This forward-looking approach differs from California's broader ban, which voids agreements regardless of when they were signed.
The Minnesota ban was driven by growing evidence that non-competes suppress wages, limit job mobility, and stifle entrepreneurship. Minnesota's tech sector and healthcare industry were particularly vocal in advocating for the ban, arguing that employee mobility drives innovation and that non-competes disproportionately harm workers who lack the resources to challenge them in court. The legislature acted after the FTC proposed its own nationwide ban, choosing not to wait for federal action.
While the ban is broad, it is not absolute. Non-competes remain permissible in connection with the dissolution or sale of a business, where the seller agrees not to compete with the buyer. Non-disclosure agreements protecting trade secrets and confidential information are also still enforceable, as are non-solicitation agreements that prevent employees from poaching specific clients or coworkers. The distinction matters: you cannot be prevented from working for a competitor, but you may still be restricted from taking proprietary information or actively soliciting your former employer's clients.
If you signed a non-compete in Minnesota before July 1, 2023, the ban does not automatically void your agreement. Courts will evaluate pre-ban agreements under the legal standards that existed when they were signed, which required non-competes to serve a legitimate business interest and be reasonable in scope, duration, and geographic area. If your pre-ban agreement is overly broad, it may still be unenforceable under those older standards.
Minnesota workers should be aware that some employers have continued to present non-compete agreements after the ban took effect, either out of ignorance or in hopes that employees will comply voluntarily. If your employer asks you to sign a non-compete after July 1, 2023, you are not legally required to do so, and your employer cannot terminate you or take adverse action for refusing. If they do, consult an employment attorney about your options.
More Minnesota workplace laws
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Frequently asked questions about non-compete laws in Minnesota
No. The ban applies only to agreements entered into on or after July 1, 2023. Non-competes signed before that date may still be enforceable if they meet the legal standards that existed at the time, including reasonableness in scope, duration, and geographic area.
Yes. The ban specifically targets non-compete agreements. Non-disclosure agreements that protect trade secrets and confidential information remain enforceable. Non-solicitation agreements may also be enforceable. The key distinction is that you cannot be prevented from working for a competitor, but you may still be restricted from sharing proprietary information.
This is a developing area of law. If you perform your work in Minnesota, Minnesota law likely applies to your employment agreement, including the non-compete ban. However, if your employer is in a state that enforces non-competes and your agreement includes a choice-of-law provision, the issue may require legal analysis. Consult an attorney for guidance specific to your situation.
Under the ban, your employer cannot require you to sign a non-compete agreement. If your employer terminates you or takes adverse action for refusing, you may have a claim for wrongful termination. Document the circumstances and consult an employment attorney.
Yes. The law applies to both employees and independent contractors. If you work as an independent contractor in Minnesota, a non-compete clause in your contract entered into on or after July 1, 2023, is void and unenforceable.