Which States Prohibit Non-compete Agreements?

[VolAgent]

"Some states prohibit non-compete agreements to a certain extent. In some cases a client is not bound by the non-compete agreement and cannot be prohibited from choosing whom to do business with. Nevertheless, those looking to transition from being an employee to their own agency should proceed with caution."

The origin of my question is this paragraph and some others. So I was curious to see if any state prohibits it.

There are non-competes, and then their are "we hope to scare you into not competing". A real non-compete is as valid and binding as any other contract in that state. You received appropriate consideration for what you gave up, the ability to pursue that business in that state. And a real non-compete can definitely keep you from your chosen profession in that state or even the entire US.

What most people end up with is a fake non-compete that either the company isn't aware is invalid or they just hope to scare you with. Generally you received no consideration for signing it and it is overly broad in its reach.

Any agreement saying that you cannot solicit former clients for a reasonable time period, 2 years to maybe 5, is almost always going to stand up. If the agreement says that you can't do insurance in the state or even the city and you weren't bought out, well good luck enforcing that one.

Of course, merely dragging you into a courtroom to defend your actions is often enough. Usually the other party has deeper pockets and will keep at you until you are broke or give up.

 

[PhilL]

Check with your State Agents' organizations, like the PIA and IIA. They may be able to give you some relative advice on non-competes in your State, even if you
are not a Member.

 

[agentinsouth]

Which states prohibit non-compete agreements? Anybody know, or located in?

Pay a good attorney before you quit.... Best investment I have ever made.

 

[Glen Shelton]

I'd be surprised if there was a state that did prohibit them.

OR prohibits non-competes - but they can/will make you sign a non-solicitation agreement.