Colorado non-compete law

Pay figure in the law

$130,014 a year

Separate rules for professions

health care workers, physicians

Statutes and official texts quoted

C.R.S. § 8-2-113(2)(a) (as amended by SB 25-083, 2025 Colo. Sess. Laws ch. 366); C.R.S. § 8-2-113(2)(b) (HB 22-1317); C.R.S. § 8-2-113(2)(c)(II) (HB 22-1317); 7 CCR 1103-14 (2026 PAY CALC Order), Rule 1.2.1 row (G); C.R.S. § 8-2-113(2)(d) (HB 22-1317); C.R.S. § 8-2-113(2)(b) (as amended by SB 25-083); C.R.S. § 8-2-113(5)(a); C.R.S. § 8-2-113(3) (HB 22-1317); C.R.S. § 8-2-113(3)(c) (as amended by SB 25-083); C.R.S. § 8-2-113(4)(a) (HB 22-1317); C.R.S. § 8-2-113(4)(b) (HB 22-1317); C.R.S. § 8-2-113(6) (HB 22-1317); C.R.S. § 8-2-113(7) (HB 22-1317); C.R.S. § 8-2-113(8)(b) (HB 22-1317); HB 22-1317, § 2(2); SB 25-083, § 2 (2025 Colo. Sess. Laws ch. 366)

Is a non-compete allowed?

As amended in 2025, a covenant not to compete restricting an individual's right to receive compensation for labor is void, except as provided in listed subsections.

“that restricts the right of any person AN INDIVIDUAL to receive compensation for performance of labor for any employer is void.”
C.R.S. § 8-2-113(2)(a) (as amended by SB 25-083, 2025 Colo. Sess. Laws ch. 366)

Pay thresholds

The ban does not apply to a non-compete for trade-secret protection, no broader than reasonably necessary, with a worker earning at least the threshold for highly compensated workers at signing and at enforcement (enacted by HB 22-1317).

“THIS SUBSECTION (2) DOES NOT APPLY TO A COVENANT NOT TO COMPETE GOVERNING A PERSON WHO, AT THE TIME THE COVENANT NOT TO COMPETE IS ENTERED INTO AND AT THE TIME IT IS ENFORCED, EARNS AN AMOUNT OF ANNUALIZED CASH COMPENSATION EQUIVALENT TO OR GREATER THAN THE THRESHOLD AMOUNT FOR HIGHLY COMPENSATED WORKERS, IF THE COVENANT NOT TO COMPETE IS FOR THE PROTECTION OF TRADE SECRETS”
C.R.S. § 8-2-113(2)(b) (HB 22-1317)

The threshold is the greater of the Division of Labor Standards and Statistics highly-compensated-worker amount as of the section's effective date (as amended) or at the time the covenant is signed.

“"THRESHOLD AMOUNT FOR HIGHLY COMPENSATED WORKERS" MEANS THE GREATER OF THE THRESHOLD AMOUNT FOR HIGHLY COMPENSATED WORKERS AS DETERMINED BY THE DIVISION OF LABOR STANDARDS AND STATISTICS IN THE DEPARTMENT OF LABOR AND EMPLOYMENT: (A) AS OF THE EFFECTIVE DATE OF THIS SECTION, AS AMENDED; OR (B) AT THE TIME THE COVENANT NOT TO COMPETE IS EXECUTED BY THE PARTIES.”
C.R.S. § 8-2-113(2)(c)(II) (HB 22-1317)

The CDLE 2026 PAY CALC Order (effective February 1, 2026) lists $130,014 annually for 'highly compensated employees'. The order itself does not mention non-competes; the statute ties the non-compete threshold to this division-determined amount.

“$130,014 annually”
7 CCR 1103-14 (2026 PAY CALC Order), Rule 1.2.1 row (G)

The ban does not apply to a customer non-solicitation covenant for a worker earning at least 60% of the highly-compensated threshold, if no broader than reasonably necessary to protect trade secrets.

“EQUIVALENT TO OR GREATER THAN SIXTY PERCENT OF THE THRESHOLD AMOUNT FOR HIGHLY COMPENSATED WORKERS IF THE NONSOLICITATION COVENANT IS NO BROADER THAN REASONABLY NECESSARY TO PROTECT THE EMPLOYER'S LEGITIMATE INTEREST IN PROTECTING TRADE SECRETS.”
C.R.S. § 8-2-113(2)(d) (HB 22-1317)

Notice and signing

An otherwise permissible non-compete is void unless notice and its terms are given to a prospective worker before accepting the offer, or to a current worker at least 14 days before the earlier of its effective date or the effective date of the consideration.

“ANY COVENANT NOT TO COMPETE THAT IS OTHERWISE PERMISSIBLE UNDER SUBSECTION (2) OR (3) OF THIS SECTION IS VOID UNLESS NOTICE OF THE COVENANT NOT TO COMPETE AND THE TERMS OF THE COVENANT NOT TO COMPETE ARE PROVIDED TO:”
C.R.S. § 8-2-113(4)(a) (HB 22-1317)

The notice must be in a separate document, in clear and conspicuous terms in the language used with the worker, and signed by the worker.

“AN EMPLOYER SHALL PROVIDE THE NOTICE REQUIRED IN SUBSECTION (4)(a) OF THIS SECTION IN A SEPARATE DOCUMENT FROM ANY OTHER COVENANTS BETWEEN THE WORKER AND EMPLOYER AND IN CLEAR AND CONSPICUOUS TERMS IN THE LANGUAGE IN WHICH THE WORKER AND EMPLOYER COMMUNICATE ABOUT THE WORKER'S PERFORMANCE. THE NOTICE MUST BE SIGNED BY THE WORKER.”
C.R.S. § 8-2-113(4)(b) (HB 22-1317)

Health care and other professions

Since SB 25-083, the high-earner exceptions do not apply to covenants restricting the practice of medicine, advanced practice registered nursing, or dentistry in Colorado.

“EXCEPT FOR A COVENANT NOT TO COMPETE THAT RESTRICTS THE PRACTICE OF MEDICINE , THE PRACTICE OF ADVANCED PRACTICE REGISTERED NURSING, OR THE PRACTICE OF DENTISTRY IN THIS STATE ,”
C.R.S. § 8-2-113(2)(b) (as amended by SB 25-083)

Non-compete provisions in agreements between physicians restricting the right to practice medicine after termination are void, though damages provisions reasonably related to the injury remain enforceable.

“Any covenant not to compete provision of an employment, partnership, or corporate agreement between physicians that restricts the right of a physician to practice medicine, as defined in section 12-240-107, upon termination of the agreement, is void;”
C.R.S. § 8-2-113(5)(a)

Exceptions

Not prohibited: certain training-cost repayment provisions, reasonable confidentiality provisions, sale-of-business covenants, and apprenticeship scholarship repayment provisions.

“(c) A COVENANT FOR THE PURCHASE AND SALE OF A BUSINESS OR THE ASSETS OF A BUSINESS; OR”
C.R.S. § 8-2-113(3) (HB 22-1317)

For a minority owner who received equity as compensation, a sale-of-business non-compete's duration in years may not exceed total sale consideration divided by average annualized cash compensation (SB 25-083).

“THE DURATION IN YEARS OF A COVENANT NOT TO COMPETE DESCRIBED IN THIS SUBSECTION (3)(c) MUST NOT EXCEED A NUMBER CALCULATED BY THE TOTAL CONSIDERATION RECEIVED BY THE INDIVIDUAL FROM THE SALE DIVIDED BY THE AVERAGE ANNUALIZED CASH COMPENSATION RECEIVED BY THE INDIVIDUAL FROM THE BUSINESS,”
C.R.S. § 8-2-113(3)(c) (as amended by SB 25-083)

If it is challenged

A worker, or a prospective new employer, may seek a declaratory judgment that the non-compete is unenforceable.

“A WORKER WHO IS A PARTY TO A COVENANT NOT TO COMPETE, OR A SUBSEQUENT EMPLOYER THAT HAS HIRED OR IS CONSIDERING HIRING THE WORKER, MAY SEEK A DECLARATORY JUDGMENT FROM A COURT OF COMPETENT JURISDICTION OR AN ARBITRATOR THAT THE COVENANT NOT TO COMPETE IS UNENFORCEABLE.”
C.R.S. § 8-2-113(7) (HB 22-1317)

An employer that enters into, presents, or tries to enforce a void non-compete is liable for actual damages and a $5,000 penalty per worker harmed; workers may recover costs and attorney fees.

“AN EMPLOYER THAT VIOLATES SUBSECTION (8)(a) OF THIS SECTION IS LIABLE FOR ACTUAL DAMAGES AND A PENALTY OF FIVE THOUSAND DOLLARS PER WORKER OR PROSPECTIVE WORKER HARMED BY THE CONDUCT.”
C.R.S. § 8-2-113(8)(b) (HB 22-1317)

Which state’s law and court

A non-compete for a worker who primarily resided or worked in Colorado at termination may not require adjudication outside Colorado, and Colorado law governs for a worker who primarily resided and worked in Colorado.

“NOTWITHSTANDING ANY CONTRACTUAL PROVISION TO THE CONTRARY, COLORADO LAW GOVERNS THE ENFORCEABILITY OF A COVENANT NOT TO COMPETE FOR A WORKER WHO AT THE TIME OF TERMINATION OF EMPLOYMENT PRIMARILY RESIDED AND WORKED IN COLORADO.”
C.R.S. § 8-2-113(6) (HB 22-1317)

When the rules took effect

HB 22-1317 applies to covenants not to compete entered into or renewed on or after the act's effective date.

“This act applies to covenants not to compete entered into or renewed on or after the applicable effective date of this act.”
HB 22-1317, § 2(2)

SB 25-083 was approved June 3, 2025 and applies to covenants entered into or renewed on or after its effective date.

“(2) This act applies to covenants not to compete entered into or renewed on or after the applicable effective date of this act. Approved: June 3, 2025”
SB 25-083, § 2 (2025 Colo. Sess. Laws ch. 366)

Federal rules

On September 5, 2025, the FTC moved to dismiss its appeals in Ryan, LLC v. FTC and Properties of the Villages v. FTC and to accede to vacatur of the Non-Compete Clause Rule. FTC press release, Sept. 5, 2025

The FTC's final rule removes the Non-Compete Rule (16 CFR part 910) from the Code of Federal Regulations. 91 Fed. Reg. (Feb. 12, 2026), FR Doc. 2026-02866

Before you sign, or before you assume you are bound

1. Find every restrictive clause: non-compete, non-solicitation, no-hire and confidentiality are separate promises with separate rules.
2. Note how long each lasts and what area or customers it covers.
3. Check which state’s law the agreement picks and where disputes must be heard.
4. Compare your pay and your job with the Colorado rules above.

Check your state with the non-compete checker.

Common questions

Are non-competes enforceable in Colorado?

As amended in 2025, a covenant not to compete restricting an individual's right to receive compensation for labor is void, except as provided in listed subsections. (C.R.S. § 8-2-113(2)(a) (as amended by SB 25-083, 2025 Colo. Sess. Laws ch. 366)).

Is there a salary threshold for non-competes in Colorado?

The CDLE 2026 PAY CALC Order (effective February 1, 2026) lists $130,014 annually for 'highly compensated employees'. The order itself does not mention non-competes; the statute ties the non-compete threshold to this division-determined amount. (7 CCR 1103-14 (2026 PAY CALC Order), Rule 1.2.1 row (G)).

Does Colorado have special non-compete rules for health care workers or other professions?

Since SB 25-083, the high-earner exceptions do not apply to covenants restricting the practice of medicine, advanced practice registered nursing, or dentistry in Colorado. (C.R.S. § 8-2-113(2)(b) (as amended by SB 25-083)).