South dakota non compete law restricts non competes by statute: south Dakota permits an employee, at hiring or any time during employment, to agree not to engage in the same business or profession as the employer, and not to solicit its existing customers within a specified county, municipality or other area, for up to two years after the agreement ends,
so long as the employer still carries on a like business there; the statute is the whole rule, so the two-year cap and the specified-area requirement are not negotiable.
This guide gives the exact South Dakota non compete law rule with the date we verified it, the threshold and carve-outs where they exist, what a court does with an overbroad term, and what to do if you signed one.
Rules verified against the statute on 2026-10-08; confirm the current rule with South Dakota Department of Labor and Regulation, Division of Labor and Management or an attorney before you rely on it.
South Dakota Non Compete Law at a Glance
| Status | Restricted by statute |
| Income threshold | No earnings threshold |
| Statute | S.D. Codified Laws 53-9-11 |
| Notice / consideration | No statutory notice rule |
| Carve-outs | Health-care practitioners are governed by 53-9-11.1 and 53-9-11.2 (added 2021 and 2023); repeated bills to cut the cap to one year (2012 HB 1004, 2019 SB 120)… |
| Overbroad terms | a covenant within the statute’s limits is enforced; one that exceeds two years or names no area fails as to the excess — courts enforce only to the statutory limits |
| In effect since | 53-9-11 since 1929; amended 1984, 2021 and 2023 (SL 2023 ch 160) |
In This South Dakota Non Compete Law Guide:
Is a Non Compete Enforceable Under South Dakota Non Compete Law?
South Dakota permits an employee, at hiring or any time during employment, to agree not to engage in the same business or profession as the employer, and not to solicit its existing customers within a specified county, municipality or other area, for up to two years after the agreement ends, so long as the employer still carries on a like business there; the statute is the whole rule,
so the two-year cap and the specified-area requirement are not negotiable.
The statute is S.D. Codified Laws 53-9-11. The carve-outs matter: health-care practitioners are governed by 53-9-11.1 and 53-9-11.2 (added 2021 and 2023); repeated bills to cut the cap to one year (2012 HB 1004, 2019 SB 120) did not pass.
South Dakota Non Compete Law at a Glance
Rules verified against the statute on 2026-10-08; confirm the current rule with South Dakota Department of Labor and Regulation, Division of Labor and Management or an attorney before you rely on it. The statute row is where to check it yourself.
| Status | Restricted by statute |
| What the rule says | South Dakota permits an employee, at hiring or any time during employment, to agree not to engage in the same business or profession as the employer, and not to solicit its existing customers within a specified county, municipality or other area, for up to two years after the agreement ends, so long as the employer still carries on a like business there; the statute is the whole rule, so the two-year cap and the specified-area requirement are not negotiable. |
| Income threshold | No earnings threshold |
| Statute | S.D. Codified Laws 53-9-11 |
| Carve-outs | Health-care practitioners are governed by 53-9-11.1 and 53-9-11.2 (added 2021 and 2023); repeated bills to cut the cap to one year (2012 HB 1004, 2019 SB 120) did not pass |
| What a court does with an overbroad term | a covenant within the statute’s limits is enforced; one that exceeds two years or names no area fails as to the excess — courts enforce only to the statutory limits |
| In effect since | 53-9-11 since 1929; amended 1984, 2021 and 2023 (SL 2023 ch 160) |
The Reasonableness Test Under South Dakota Non Compete Law
South Dakota courts mostly check whether the agreement stays inside the limits the statute sets, rather than running an open-ended fairness test. The agreement must name a specific area, such as a county or city, and that area must be one where the employer still runs a similar business. Its length must stay within the statutory cap, and it can only cover the same business or profession as the employer’s.
Courts read these agreements narrowly against the employer, and an agreement that falls outside the statute is generally void.
Courts have generally upheld agreements of up to two years after the job ends that are tied to named counties or cities where the employer actually does business. Courts have generally refused to enforce agreements that name no area, reach places where the employer does not operate, or try to bar work outside the employer’s own line of business.
With an overbroad term the court will a covenant within the statute’s limits is enforced; one that exceeds two years or names no area fails as to the excess — courts enforce only to the statutory limits.
South Dakota Non Compete Law If You Were Fired or Laid Off
The South Dakota statute does not treat a firing or layoff differently from a resignation, and it measures the restricted period from when the agreement ends. A worker who was let go may still want an attorney to look at whether the circumstances of the termination affect enforcement, because that question has not been clearly settled.
What the Employer Must Give Under South Dakota Non Compete Law
The statute lets an employee agree to a non compete “at the time of employment or at any time during” employment. In practice this means keeping the job is generally treated as enough in exchange. Some agreements also include a bonus, raise or promotion, and it is worth checking what your copy says it was signed in exchange for.
Non Solicit and Non Disclosure Agreements Under South Dakota Non Compete Law
A non solicit only stops you from going after the former employer’s existing customers or clients, and a non disclosure agreement only protects confidential information. Neither one stops you from working in your field. Because they restrict less, courts generally find them easier to enforce, and South Dakota keeps client non solicits available even for the health care and community services workers whose non competes the state has limited.
If You Already Signed One: South Dakota Non Compete Law in Practice
Find your signed copy and read exactly what work it bars, which area it names, how long it lasts and when it starts. Then check whether your new job actually falls inside those terms, and ask your former employer for a written release or waiver if it might.
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Before you accept or turn down an offer, consider having a South Dakota employment attorney review the agreement, since outcomes depend on the exact wording.
An employer that believes a valid non compete was broken can ask a South Dakota court for an injunction ordering the worker to stop the competing work, and can also seek money damages for losses it can prove. Attorney fees are generally available only if the agreement itself provides for them, so check your copy for a fee clause.
The Federal Rule and South Dakota Non Compete Law
The Federal Trade Commission adopted a nationwide non compete ban in 2024, but a federal court blocked it before it took effect and the FTC later withdrew its defense; as of October 2026 there is no federal ban in force, so South Dakota non compete law controls.
Senate Bill 153 (2026), signed March 9, 2026 and effective July 1, 2026, makes non competes signed on or after that date voidable when they bar community services providers from working with or serving people with developmental disabilities, though limits on soliciting current clients still apply. House Bill 1180 (2026), also effective July 1, 2026, separately addresses non competes for business owners who transfer an ownership interest, not ordinary employees.
Other South Dakota Non Compete Law Rules to Know
South Dakota limits non competes for many licensed health care workers, including physicians, physician assistants, nurse practitioners, nurse midwives, nurse anesthetists, registered nurses and licensed practical nurses (2021), along with a broader list of health professions added in 2023. For these workers, a contract generally cannot restrict where they practice after leaving or bar them from treating current patients.
Confirm with the state legislature or an attorney whether your profession is covered.
Think your employer owes you money or broke the law?
A non compete is a contract question, and the answer turns on your own agreement’s words. Your state bar runs a lawyer-referral service that connects you with an employment attorney for a short, low-cost first consultation — find it through the American Bar Association referral directory. Free legal aid may also help if your income qualifies.
South Dakota — the bottom line
- South dakota non compete law is a statute with its own limits — the first thing to check is which side of the line your agreement falls on.
- Under South Dakota non compete law, an overbroad term is a covenant within the statute’s limits is enforced; one that exceeds two years or names no area fails as to the excess — courts enforce only to the statutory limits — the words of your own agreement decide more than the headline rule.
- South dakota non compete law does not stop you from taking a new job in a different field or outside the restricted area — read the scope before you turn an offer down.
Frequently Asked Questions
Are non competes enforceable in South Dakota?
Sometimes.
South Dakota permits an employee, at hiring or any time during employment, to agree not to engage in the same business or profession as the employer, and not to solicit its existing customers within a specified county, municipality or other area, for up to two years after the agreement ends, so long as the employer still carries on a like business there; the statute is the whole rule,
so the two-year cap and the specified-area requirement are not negotiable.
Is there an income threshold under South Dakota non compete law?
No. South Dakota has no earnings threshold; enforcement turns on whether the agreement is reasonable.
What does a South Dakota court do with an overbroad non compete?
A covenant within the statute’s limits is enforced; one that exceeds two years or names no area fails as to the excess — courts enforce only to the statutory limits.
Can my employer enforce a non compete in South Dakota after firing me?
The South Dakota statute does not treat a firing or layoff differently from a resignation, and it measures the restricted period from when the agreement ends.
I signed a non compete in South Dakota and have a new offer — what should I do?
Find your signed copy and read exactly what work it bars, which area it names, how long it lasts and when it starts. Then check whether your new job actually falls inside those terms, and ask your former employer for a written release or waiver if it might.
Official South Dakota Sources & Resources
- South Dakota Department of Labor and Regulation, Division of Labor and Management: https://dlr.sd.gov/employment_laws/default.aspx
- South Dakota non compete statute (S.D. Codified Laws 53-9-11): https://sdlegislature.gov/Statutes/53-9-11
- U.S. Department of Labor, Wage and Hour Division — state payday requirements: dol.gov
- Federal Trade Commission — the non compete rule (status): ftc.gov
- South Dakota bar lawyer referral: https://www.findalawyerinsd.com
This South Dakota non compete law guide was last verified against official South Dakota sources in October 2026. Rules change — confirm the current figure with the state agency or a licensed attorney.
More South Dakota Workplace Rights Guides
- South Dakota Final Paycheck Law: Deadlines and Penalties
- South Dakota Wrongful Termination Laws: When a Firing Is Illegal
- South Dakota At Will Employment Law: The Exceptions
- South Dakota Labor Laws: Every Rule in One Place
- Unemployment and Workplace Rights Guides for All 50 States
Disclaimer: This guide is general information, not legal or financial advice. My Unemployment Rights is an independent educational resource, not a government agency and not a law firm. Final-paycheck deadlines, penalties and non compete rules change — every figure here carries the date we verified it. Confirm the current rule with your state labor department or a licensed attorney before you act.