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ARTICLE · 30 JUNE 2023

Minnesota Prohibits Post-Employment Noncompetes

Perkins Coie LLP
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On May 24, 2023, the state of Minnesota enacted a labor bill (SF 3035) that prohibits employers' use of noncompetes, effective July 1, 2023.

United StatesEmployment and HR
Emily A. Bushaw
Emily A. Bushaw
Kelsey Cropper
Kelsey Cropper

On May 24, 2023, the state of Minnesota enacted a labor bill (SF 3035) that prohibits employers' use of noncompetes, effective July 1, 2023. The ban does not apply retroactively to noncompetes signed prior to July 1, 2023.

Definition of Noncompete

Minnesota defines a noncompete as an agreement that restricts a former employee's ability to:

  • Work for another employer for a specified period of time.
  • Work in a specified geographical area.
  • Work for another employer in a capacity similar to the employee's work for the employer that is party to the agreement.

The definition only encompasses restrictions that limit an employee's activities after the termination of employment. As a result, the new law does not prohibit restrictions that limit current employee activities.

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