Colorado non compete law restricts non competes by statute: colorado voids most non competes; one is allowed only for a highly compensated worker, only to protect trade secrets, no broader than necessary, and only with separate signed notice — and the worker must be above the threshold both when signing and when the employer tries to enforce it.
This guide gives the exact Colorado 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 Colorado Department of Labor and Employment, Division of Labor Standards and Statistics on 2026-10-08; confirm the current rule with Colorado Department of Labor and Employment, Division of Labor Standards and Statistics or an attorney before you rely on it.
Colorado Non Compete Law at a Glance
| Status | Restricted by statute |
| Income threshold | The CDLE’s annual PAY CALC Order sets the highly compensated figure ($101,250 in 2022, reported at $130,014 for 2026); customer non solicits need 60% of that figure |
| Statute | Colo. Rev. Stat. 8-2-113 |
| Notice / consideration | Separate signed written notice in clear terms before a prospective worker accepts the offer, or at least 14 days before the covenant (or the consideration for it) takes effect for a current worker; a missed notice voids the covenant |
| Carve-outs | Physicians (covenants restricting the right to practice are void); customer non solicits only above 60% of the threshold; sale of a business; recovery of… |
| Overbroad terms | void if non compliant; presenting or trying to enforce a void covenant carries a $5,000 penalty per worker plus damages and fees, and intimidating a worker with one is a class 2 misdemeanor |
| In effect since | August 10, 2022 (HB 22-1317); threshold updated each January |
In This Colorado Non Compete Law Guide:
Is a Non Compete Enforceable Under Colorado Non Compete Law?
Colorado voids most non competes; one is allowed only for a highly compensated worker, only to protect trade secrets, no broader than necessary, and only with separate signed notice — and the worker must be above the threshold both when signing and when the employer tries to enforce it. The statute is Colo. Rev. Stat. 8-2-113.
The carve-outs matter: physicians (covenants restricting the right to practice are void); customer non solicits only above 60% of the threshold; sale of a business; recovery of training costs; Colorado law and courts apply to anyone who mainly lived or worked in Colorado at termination.
Colorado Non Compete Law at a Glance
Rules verified against Colorado Department of Labor and Employment, Division of Labor Standards and Statistics on 2026-10-08; confirm the current rule with Colorado Department of Labor and Employment, Division of Labor Standards and Statistics 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 | Colorado voids most non competes; one is allowed only for a highly compensated worker, only to protect trade secrets, no broader than necessary, and only with separate signed notice — and the worker must be above the threshold both when signing and when the employer tries to enforce it. |
| Income threshold | The CDLE’s annual PAY CALC Order sets the highly compensated figure ($101,250 in 2022, reported at $130,014 for 2026); customer non solicits need 60% of that figure |
| Statute | Colo. Rev. Stat. 8-2-113 |
| Notice or consideration rule | Separate signed written notice in clear terms before a prospective worker accepts the offer, or at least 14 days before the covenant (or the consideration for it) takes effect for a current worker; a missed notice voids the covenant |
| Carve-outs | Physicians (covenants restricting the right to practice are void); customer non solicits only above 60% of the threshold; sale of a business; recovery of training costs; Colorado law and courts apply to anyone who mainly lived or worked in Colorado at termination |
| What a court does with an overbroad term | void if non compliant; presenting or trying to enforce a void covenant carries a $5,000 penalty per worker plus damages and fees, and intimidating a worker with one is a class 2 misdemeanor |
| In effect since | August 10, 2022 (HB 22-1317); threshold updated each January |
The Reasonableness Test Under Colorado Non Compete Law
A Colorado court first checks whether the agreement fits one of the narrow exceptions the statute allows. If it does, the court asks whether the restriction protects trade secrets and is no broader than reasonably necessary to protect the employer’s legitimate interest in them. Courts look at how long it lasts, the area it covers, and the kinds of work it bars.
They also consider how hard it would be for the worker to earn a living. A restriction that would be void when signed is treated as void, not just weakened.
Restrictions of 1 year or less that cover the actual territory or customers the worker served have usually held up better than multi-year, statewide or nationwide bans. Colorado courts have refused to “blue pencil,” meaning rewrite an overly broad agreement into a narrower one, so a restriction that goes too far may fail entirely.
With an overbroad term the court will void if non compliant; presenting or trying to enforce a void covenant carries a $5,000 penalty per worker plus damages and fees, and intimidating a worker with one is a class 2 misdemeanor.
Colorado Non Compete Law If You Were Fired or Laid Off
Colorado’s statute does not treat a non compete differently based on whether the worker was fired, laid off, or quit, so the same legal tests generally apply in each case. Some agreements have their own clauses that depend on how the job ended, so check your agreement’s wording and confirm with a lawyer.
What the Employer Must Give Under Colorado Non Compete Law
Separate signed written notice in clear terms before a prospective worker accepts the offer, or at least 14 days before the covenant (or the consideration for it) takes effect for a current worker; a missed notice voids the covenant The Colorado Supreme Court has held that continued at-will employment can be enough consideration for a non compete signed by a current employee.
Under current law, the agreement must still meet the statute’s other requirements, or it is void no matter what the worker received for signing.
Non Solicit and Non Disclosure Agreements Under Colorado Non Compete Law
Colorado limits customer non solicit agreements the same way it limits non competes, though they can apply at a lower pay level. Confidentiality agreements are generally allowed, but they cannot block a worker from using general training, knowledge, skill or experience, or information that is publicly available or that the worker otherwise has a right to disclose.
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If You Already Signed One: Colorado Non Compete Law in Practice
Before accepting a new offer, read the agreement closely: what work it bars, where, for how long, and whether it covers customers or only competitors. Ask your former employer in writing for a release or a written statement that it will not enforce the agreement against the new job.
Since many Colorado non competes are void under the statute, consider having an employment lawyer review the agreement before you turn down or start new work.
When an agreement is valid, the employer may ask a court for an injunction to stop the competing work and may seek damages it can prove, along with attorney fees if the contract allows them. An employer that presents or tries to enforce a void non compete can itself owe the worker actual damages, a 5000 penalty per worker, and attorney fees, and can be charged with a misdemeanor.
The Federal Rule and Colorado 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 Colorado non compete law controls.
Senate Bill 25-083, passed in 2025, bans non competes and customer non solicits for physicians, dentists, advanced practice registered nurses, and certified midwives, even if they are highly paid. It also limits non competes tied to the sale of a minority ownership share. It applies to agreements entered into or renewed on or after August 6, 2025.
Other Colorado Non Compete Law Rules to Know
If you mostly lived and worked in Colorado when your job ended, the employer generally cannot require you to litigate the non compete in another state or under another state’s law. Colorado also allows employers to recover certain education and training costs, so read any repayment clause in your agreement separately.
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.
Colorado — the bottom line
- Colorado 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 Colorado non compete law, an overbroad term is void if non compliant; presenting or trying to enforce a void covenant carries a $5,000 penalty per worker plus damages and fees, and intimidating a worker with one is a class 2 misdemeanor — the words of your own agreement decide more than the headline rule.
- Colorado 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 Colorado?
Sometimes. Colorado voids most non competes; one is allowed only for a highly compensated worker, only to protect trade secrets, no broader than necessary, and only with separate signed notice — and the worker must be above the threshold both when signing and when the employer tries to enforce it.
Is there an income threshold under Colorado non compete law?
The CDLE’s annual PAY CALC Order sets the highly compensated figure ($101,250 in 2022, reported at $130,014 for 2026); customer non solicits need 60% of that figure
What does a Colorado court do with an overbroad non compete?
Void if non compliant; presenting or trying to enforce a void covenant carries a $5,000 penalty per worker plus damages and fees, and intimidating a worker with one is a class 2 misdemeanor.
Can my employer enforce a non compete in Colorado after firing me?
Colorado’s statute does not treat a non compete differently based on whether the worker was fired, laid off, or quit, so the same legal tests generally apply in each case.
I signed a non compete in Colorado and have a new offer — what should I do?
Before accepting a new offer, read the agreement closely: what work it bars, where, for how long, and whether it covers customers or only competitors. Ask your former employer in writing for a release or a written statement that it will not enforce the agreement against the new job.
Official Colorado Sources & Resources
- Colorado Department of Labor and Employment, Division of Labor Standards and Statistics: https://cdle.colorado.gov/wage-and-hour-law
- Colorado non compete statute (Colo. Rev. Stat. 8-2-113): https://leg.colorado.gov/bills/hb22-1317
- Verified source: https://leg.colorado.gov/sites/default/files/documents/2025A/bills/2025a_083_01.pdf
- U.S. Department of Labor, Wage and Hour Division — state payday requirements: dol.gov
- Federal Trade Commission — the non compete rule (status): ftc.gov
- Colorado bar lawyer referral: https://www.cobar.org/Licensed-Lawyer
This Colorado non compete law guide was last verified against official Colorado sources in October 2026. Rules change — confirm the current figure with the state agency or a licensed attorney.
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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.