Colorado has enlisted the help of the criminal justice system to
reinforce its strong public policy against restrictive covenants.
Beginning on March 1, 2022, violations of Colorado's
restrictive covenants statute, C.R.S. § 8-2-113, may subject
employers to criminal liability. Under
Colorado Senate Bill 21-271, which is primarily geared toward
reformation of sentencing guidelines for misdemeanors and petty
offenses, any violation of C.R.S. § 8-2-113 will be a class 2
misdemeanor punishable by up to 120 days in jail, a fine of up to
$750, or both.
C.R.S. § 8-2-113 voids certain restrictive covenants, such
as noncompete and nonsolicitation-of-customers agreements, unless
they concern one or more of the following exceptions: (1) the
purchase or sale of a business or its assets; (2) the protection of
trade secrets; (3) the recovery of education or training expenses
associated with an employee who has been with an employer for less
than two years; or (4) a restriction on
