Are non-compete agreements enforceable?

It depends on the state. California and several other states do not enforce them against employees, and many others limit them by income, role or duration or require advance notice. Non-competes tied to the sale of a business are more widely enforced. Check your state's law before using one.

How long should a non-compete last?

Courts usually look for the shortest period that protects a real business interest; six to twelve months is common for employees, and longer is more often accepted for a business sale. The template leaves the period blank.

Is a non-solicitation agreement a better choice?

Often. A non-solicitation agreement only stops someone from taking customers or staff, which courts accept more readily than a ban on working in the field. There is a separate template for it.

Is this legal advice?

No. It is a general-purpose starting point. Because enforceability varies so much, have a lawyer in the relevant state review a non-compete before you rely on it.

Free template

Non-compete agreement template

A non-compete agreement asks a person not to work for or start a competing business for a limited time and area. Courts look hard at these, so this template is deliberately narrow and leaves the scope, territory and duration for you to set. Edit it in the browser and send it for signature from the same page; the free plan includes 5 sends a month and never asks for a card.

Start free with this template

When to use it

Buying a business, where the seller agrees not to open a competitor down the street.
A senior employee or partner with deep access to trade secrets, in a state that enforces non-competes.
A business partner leaving a venture who will take customer relationships with them.

What's in it

1.Consideration
2.Business protected
3.Restriction
4.What is not restricted
5.Notice to new employers
6.Remedies
7.Reasonableness and severability
8.General

Plus signature, name and date fields for company and restricted party.

The full template

The text you start from, exactly as it opens in the editor. Bracketed blanks are yours to fill in; highlighted fields are filled by each signer.

Non-Compete Agreement

This Non-Compete Agreement (the “Agreement”) is made as of Date signed — Company between [Company legal name] (the “Company”) and [Name] (the “Restricted Party”). Before relying on it, check the law of the state where the Restricted Party lives and works: several states, California among them, do not enforce non-competes against employees, and others limit them by income, role or notice.

1. Consideration

The Restricted Party enters this Agreement in exchange for [describe what they receive, e.g. employment / a promotion / payment of $[amount] / the purchase price for their interest in the business], which they acknowledge is adequate.

2. Business protected

The “Business” means [describe narrowly, e.g. providing payroll software to dental practices]. The Company has legitimate interests in its trade secrets, confidential information and customer goodwill in the Business, which this Agreement is meant to protect.

3. Restriction

During the Restricted Party's [employment / engagement / ownership] and for [six (6) / twelve (12)] months after it ends (the “Restricted Period”), the Restricted Party will not, within [territory, e.g. the counties where the Company had customers in the last twelve months], own, manage, be employed by or provide services to a business that competes with the Business in a role similar to the one they held with the Company.

4. What is not restricted

This Agreement does not prevent the Restricted Party from owning up to [two (2)]% of a publicly traded company, working for a competitor in a role unrelated to the Business, or any activity the Company approves in writing.

5. Notice to new employers

During the Restricted Period, the Restricted Party will tell any prospective employer or client in a competing business about this Agreement before accepting a role, and the Company may provide a copy to them.

6. Remedies

A breach may cause the Company harm that money cannot fully repair, so the Company may seek an injunction in addition to any other remedy. The Restricted Period is extended by any period of breach, where the law allows.

7. Reasonableness and severability

The parties intend each restriction to be no broader than needed. If a court finds any restriction too broad, the parties ask that it be narrowed to the maximum enforceable extent rather than struck out, and the rest of this Agreement remains in effect.

8. General

This Agreement is governed by the laws of the State of [State]. It is the entire agreement on its subject and may be changed only in writing signed by both parties. The Company may assign it to a successor to the Business.

Signatures

Company

Signature: Signature — Company

Name: Full name — Company

Date: Date signed — Company

Restricted party

Signature: Signature — Restricted party

Name: Full name — Restricted party

Date: Date signed — Restricted party

This template is a general-purpose starting point written in plain English for use in the United States. It is not legal advice and has not been reviewed for your situation; for anything high-stakes, have a lawyer review the final version.

How to send it for signature

Step 1
Start from the template
It opens as a document in the editor with both parties' signature, name and date fields already placed. Fill in the bracketed blanks and change any clause.
Step 2
Add who signs
Put an email address on each party, set the signing order if it matters, add an access code if you want one, and add a viewer for anyone who only needs to read it.
Step 3
Send it and track it
Each signer gets a link and signs in the browser, no account needed. You see who has opened and signed, and everyone gets the completed PDF with a certificate of completion.