On March 19, 2025, Wyoming enacted a new law significantly restricting the use of non-compete agreements except in limited circumstances. The new law contains several exceptions, including non-competes tied to the sale of a business, protection of trade secrets, and covenants with executive and management personnel. Notably, the law applies to any “person”, which includes both employees and independent contractors. The law is slated to become effective on July 1, 2025 and will only apply to agreements entered into on or after that date.
Wyoming now joins four other states, California, Oklahoma, Minnesota, and North Dakota, that have either banned or significantly restricted non-compete agreements with limited exceptions. On the federal level, in 2024, a federal court enjoined and set aside the FTC’s Rule banning non-competes. On March 7, 2025, the FTC filed for a 120-day stay of its appeals in the Fifth and Eleventh Circuits while it considers how to proceed under the new administration.
Employers should remain cognizant of ongoing state and federal legislative efforts to prohibit or restrict non-compete agreements, and consult with counsel to ensure compliance.
