On June 3, 2017, Governor Sandoval signed Assembly Bill 276 into
law, amending Nevada Revised Statute 613, which governs
non-competition agreements. Notably, the law adds requirements to
the enforceability and validity of non-competition agreements, and
importantly, now allows courts to "blue-pencil"
non-competition agreements, overturning Nevada Supreme
Court's recent decision in Golden Road Motor Inn, Inc. v.
Islam.
First, the new law establishes that a non-competition agreement
is void and unenforceable unless the agreement satisfies four
requirements. The agreement must: (1) be supported by valuable
consideration; (2) not impose a restraint greater than what is
required to protect the employer; (3) not impose an undue hardship
on the employee; and (4) impose restrictions that are appropriate
in relation to the valuable consideration supporting the
agreement.
