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Defined by statute

Covenant not to compete

An agreement restricting where, for whom, for how long, or in what capacity an employee may work after the employment ends — void and unenforceable in Minnesota, by statute, in a contract or agreement entered into on or after July 1, 2023, outside the sale-of-a-business and dissolution exceptions in Minn. Stat. § 181.988, subd. 2(b).

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Also called: noncompete; non-compete; noncompete agreement; restrictive covenant.

“Covenant not to compete” means an agreement between an employee and employer that restricts the employee, after termination of the employment, from performing:

(1) work for another employer for a specified period of time;

(2) work in a specified geographical area; or

(3) work for another employer in a capacity that is similar to the employee’s work for the employer that is party to the agreement.

Minn. Stat. § 181.988, subd. 1(a). This definition is the gate for subdivision 2, which makes any covenant not to compete “void and unenforceable” outside the sale-of-a-business and dissolution exceptions in subdivision 2(b). Subdivision 1(a) then excludes three things by name: a nondisclosure agreement, an agreement designed to protect trade secrets or confidential information, and a nonsolicitation agreement. A document titled “Non-Compete” is not a covenant not to compete unless what it restricts is work. The section took effect July 1, 2023, “and applies to contracts and agreements entered into on or after that date.” Laws 2023, ch. 53, art. 6, § 1.

Where this comes up

Sources checked September 8, 2026. Citations independently verified against the primary source September 8, 2026.

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