Colorado Non-Compete Laws (2026): Are Non-Competes Enforceable?

Most non-competes are void in Colorado. C.R.S. § 8-2-113(2)(a) provides that "a covenant not to compete that restricts the right of an individual to receive compensation for performance of labor is void," and the exceptions are narrow. The main one covers a highly compensated worker, earning at least $130,014 in annualized cash compensation in 2026, and only for a covenant that protects trade secrets and is no broader than reasonably necessary to do so.

Even a covenant that fits an exception is void unless the employer gave a separate, signed notice on time. Since August 6, 2025, the earnings-based exceptions are not available at all for covenants restricting the practice of medicine, advanced practice registered nursing or dentistry. For how other states compare, see our non-compete laws by state guide.

Information last verified on 2026-10-08. This article has not been reviewed by a licensed lawyer.

Jurisdiction scope: This article covers Colorado's restrictive-covenant statute, C.R.S. § 8-2-113, as amended through 2025 (HB 22-1317, HB 24-1324 and SB 25-083), the Colorado appellate cases that interpret it, and a short note on the federal FTC rule. It does not cover trade-secret claims (see Colorado trade secret laws) or severance agreements (see Colorado severance pay laws).

Are non-competes enforceable in Colorado?

Only within the exceptions the statute lists. Section 8-2-113(2)(a) makes the starting rule voidness. The highly compensated exception in subsection (2)(b) then reads:

"this subsection (2) does not apply to a covenant not to compete governing an individual 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 and is no broader than is reasonably necessary to protect the employer's legitimate interest in protecting trade secrets." C.R.S. § 8-2-113(2)(b)

That exception has three parts, and a covenant must meet all of them: the pay level at signing, the pay level at enforcement, and a trade-secret purpose with narrow terms. The statute text is published by the legislature's Office of Legislative Legal Services in its 2025 edition of the Colorado Revised Statutes, which lists amendments through 2025.

The rest of the statute adds permitted categories that do not depend on pay (training repayment, confidentiality, sale of a business, apprenticeship scholarships), discussed below. The current rules apply to covenants entered into or renewed on or after August 10, 2022; HB 22-1317 states that it "applies to covenants not to compete entered into or renewed on or after the applicable effective date of this act." A covenant signed before that date and not renewed is judged under the earlier version of § 8-2-113, which had no pay threshold and included an exception for executive and management personnel and their professional staff.

The 2026 salary threshold

The statute does not print a dollar figure. It defines "the threshold amount for highly compensated workers" as the greater of the figure the Colorado Department of Labor and Employment's Division of Labor Standards and Statistics had set as of August 10, 2022, or the figure in effect when the covenant is signed (C.R.S. § 8-2-113(2)(c)(II)). A worker employed for less than a calendar year meets it if the worker would reasonably expect to earn more than the threshold during a calendar year of employment (§ 8-2-113(2)(c)(III)).

The 2026 figure comes from row G of the Division's 2026 PAY CALC Order (7 CCR 1103-14, adopted December 8, 2025), which lists highly compensated employees at "$130,014 annually." The order computes it as the annual salary for exempt executive, administrative and professional employees multiplied by 2.25, and the Division issues a new order each year. The Division first put the $130,014 figure into effect on January 1, 2026 through a temporary 2026 PAY CALC Order, and the permanent order took effect February 1, 2026, so $130,014 is the figure in effect for covenants signed on or after January 1, 2026. We found no separate Division notice for non-competes; the statute points to the Division's highly compensated figure, and this is that figure. The Division does not publish a dollar figure for the 60 percent non-solicitation line, so this page does not state one.

Because the pay test applies again at enforcement, a worker whose annualized cash compensation has fallen below the threshold by the time the employer tries to enforce the covenant is outside the exception.

The trade-secret requirement

Earning enough is not sufficient. The covenant must be "for the protection of trade secrets" and no broader than reasonably necessary to protect that interest. A covenant aimed at keeping a worker from competing in general, without that purpose, does not fit.

Older cases describe the same limit. In Gold Messenger, Inc. v. McGuay, 937 P.2d 907 (Colo. App. 1997), decided under the pre-2022 statute, the Court of Appeals said non-competes are disfavored, the exceptions are construed narrowly, and a covenant fits the trade-secret exception only if its purpose is protecting trade secrets and it is reasonably limited in scope to that purpose. The 2022 rewrite states an intent to preserve earlier case law on what counts as a covenant not to compete and on tailoring to trade secrets (§ 8-2-113(1)).

Customer non-solicitation agreements

Colorado treats a covenant not to solicit customers as a form of non-compete. Under § 8-2-113(2)(d), it is permitted only for a worker earning at least 60 percent of the highly compensated threshold at signing and at enforcement, and only if it is no broader than reasonably necessary to protect trade secrets. The same health-care exclusion applies.

Two pre-2022 Court of Appeals decisions take the same view. Phoenix Capital, Inc. v. Dowell, 176 P.3d 835 (Colo. App. 2007), held that a covenant fitting no statutory exception when signed is void from the start, not merely voidable, and that a customer non-solicit cannot be enforced where the non-compete would be invalid. Saturn Systems, Inc. v. Militare, 252 P.3d 516 (Colo. App. 2011), treated a customer non-solicit as a non-compete enforceable only within the trade-secret exception, asking first whether any covenant is justified and then whether its specific terms are reasonable.

The notice rule

A covenant that is otherwise permitted is void unless the worker got proper notice (§ 8-2-113(4)(a)). The timing depends on whether the worker is new or already employed:

• Prospective worker: notice of the covenant and its terms before the worker accepts the offer of employment.
• Current worker: notice at least 14 days before the earlier of the covenant's effective date or the effective date of any additional compensation or change in terms that provides the consideration for it.

Under § 8-2-113(4)(b), the notice must be in a separate document, written in clear and conspicuous terms, in the language the worker and employer use to communicate about the worker's performance, and signed by the worker. A clause buried in the main agreement is not enough.

Section 8-2-113(4)(d) offers employers a safe harbor: notice delivered with a copy of the agreement, identifying the agreement by name, stating that it contains a covenant not to compete that could restrict the worker's options for later employment, and directing the worker to the specific sections or paragraphs. A worker may also ask for an additional copy of the covenant once per calendar year (§ 8-2-113(4)(c)).

Signing a non-compete after you start the job

In Lucht's Concrete Pumping, Inc. v. Horner, 255 P.3d 1058 (Colo. 2011), the Colorado Supreme Court held that an employer that refrains from firing an existing at-will employee provides adequate consideration for a noncompetition agreement signed after hire. That decision predates the 2022 rewrite, and we found no opinion addressing how it fits with the current statute. The 14-day notice rule for current workers applies regardless.

Doctors, nurse practitioners and dentists

SB 25-083 closed the earnings exceptions to health care. For covenants entered into or renewed on or after August 6, 2025, neither the highly compensated exception nor the 60 percent non-solicitation exception applies to a covenant restricting the practice of medicine, advanced practice registered nursing or dentistry (§ 8-2-113(2)(b), (2)(d)). The statute defines the practice of medicine to include practice as a physician assistant. For those covenants the general rule of voidness then governs, leaving only the pay-independent categories in subsection (3), such as the sale of a business.

Section 8-2-113(5.5) adds that a covenant is deemed to restrict the practice if it prohibits or materially restricts a health-care provider (defined as an individual licensed to practice medicine or dentistry, registered to practice advanced practice registered nursing, or licensed as a certified midwife) from telling a patient the provider treated before leaving about the provider's continuing practice, new contact information, or the patient's right to choose a provider.

Covenants entered into before August 6, 2025, and not renewed since, are governed by the statute as it stood before SB 25-083, which did not have this health-care carve-out. The session law says so directly: "This act applies to covenants not to compete entered into or renewed on or after the applicable effective date of this act."

Lawyers

Colorado Rule of Professional Conduct 5.6(a) bars a lawyer from participating in offering or making an employment or similar agreement that "restricts the right of a lawyer or LLP to practice after termination of the relationship, except an agreement concerning benefits upon retirement." Comment [3] says restrictions included in the sale of a law practice under Rule 1.17 are not prohibited.

Other restrictions the statute allows

Subsection (3) permits several covenants regardless of pay, subject to the notice rule:

For a minority owner who received the ownership share as equity compensation or for services, SB 25-083 added a duration cap: in years, the covenant may not exceed the total consideration received from the sale divided by the owner's average annualized cash compensation from the business over the preceding two years or the period of affiliation, whichever is shorter (§ 8-2-113(3)(c)). The training-repayment provision also may not violate the federal Fair Labor Standards Act or Colorado's wage laws in title 8, article 4.

Fired, laid off or quit

Section 8-2-113 makes no distinction between quitting and being fired or laid off. The pay test does the work: the threshold must be met "at the time the covenant not to compete is entered into and at the time it is enforced."

What a court does with an overbroad covenant

The statute does not say whether a court may narrow an overbroad trade-secret covenant, and we found no Colorado opinion on that question under the current statute. Section 8-2-113(5) keeps the rest of an agreement enforceable if it does not include an unlawful restrictive covenant. Under Phoenix Capital, a covenant that fits no exception when signed is void from the start.

Choice of law and venue

Colorado limits out-of-state clauses. Under § 8-2-113(6), a covenant that applies to a worker who, at the time of termination, primarily resided or worked in Colorado "may not require the worker to adjudicate the enforceability of the covenant outside of Colorado." The same subsection provides that Colorado law governs the enforceability of a covenant for a worker who primarily resided and worked in Colorado at termination, notwithstanding contrary contract terms.

The two tests differ: the venue rule covers a worker who lived or worked in Colorado, while the governing-law rule covers a worker who lived and worked there.

Penalties and how to challenge a covenant

Colorado puts money penalties behind the rule. Under § 8-2-113(8), an employer may not enter into, present as a term of employment, or attempt to enforce a covenant that is void under the section. An employer that does so is liable for "actual damages and a penalty of five thousand dollars per worker or prospective worker harmed by the conduct."

• Who can sue: the Attorney General, or any harmed worker, for injunctive relief and penalties. A worker may also recover actual damages, reasonable costs and attorney fees.
• Good faith: a court may reduce or waive the penalty if the employer proves it acted in good faith and had reasonable grounds.
• No double recovery: an Attorney General recovery precludes a duplicate recovery by the worker.
• Training repayment: the Attorney General may recover three times any amount recovered or sought in violation of the training-repayment rules.

A worker, or a later employer that has hired or is considering hiring the worker, may also ask a court or arbitrator to declare the covenant unenforceable (§ 8-2-113(7)). Separately, using force, threats or other intimidation to keep a person from any lawful occupation is a class 2 misdemeanor (§ 8-2-113(1.5)).

The Colorado Attorney General's consumer protection section lists "unlawful noncompete agreements, including training repayment agreements" among the protections it enforces. We found no Attorney General rules adopted under § 8-2-113.

Recent and pending changes

We found no 2026 bill amending § 8-2-113. That rests on searches of the General Assembly's site for non-compete and related terms, which match bill titles and could miss a provision inside a larger bill.

The FTC rule and Colorado non-competes

The FTC's nationwide non-compete rule never took effect. A federal court in Texas set it aside on August 20, 2024 (Ryan, LLC v. FTC, No. 3:24-CV-00986-E, N.D. Tex.); the FTC voted on September 5, 2025 to dismiss its appeals, and on February 12, 2026 it removed the rule from the Code of Federal Regulations. The FTC still brings case-by-case actions, including a June 22, 2026 final order requiring a pest-control company to stop enforcing non-competes. See FTC non-compete ban struck down and our non-compete laws by state guide.

Non-competes and trade secrets

Because Colorado allows non-competes only to protect trade secrets, the two overlap more than in most states. Trade-secret law still protects an employer whether or not a worker signed a covenant; see Colorado trade secret laws.

Questions this page does not answer yet

Our research did not verify these points, so this page states no rule on them:

• how Colorado appellate courts have applied the rewritten § 8-2-113 since 2022;
• whether a court may narrow an overbroad trade-secret covenant under the current statute;
• the Division's 2025 figure, which governs covenants signed in 2025;
• whether any profession other than health care and law has its own non-compete statute.

If you have been asked to sign

Under § 8-2-113, the questions are whether your annualized cash compensation meets the threshold now and is expected to later, whether the covenant is tied to trade secrets, whether you received a separate signed notice on time, and whether the health-care carve-out applies. A lawyer licensed in Colorado can review a specific agreement. The Attorney General's consumer protection section lists unlawful non-competes among the protections it enforces.

Related

• Non-compete laws by state
• Colorado trade secret laws
• Colorado severance pay laws
• Colorado at-will employment laws
• FTC non-compete ban struck down

Disclaimer: This article provides general legal information about Colorado non-compete law under C.R.S. § 8-2-113, not legal advice. The information was last verified on 2026-10-08. For a specific agreement, contact the Colorado Attorney General's consumer protection section, a legal aid office, or a lawyer licensed in Colorado.

Last updated: 2026-10-08.

Frequently Asked Questions

Are non-competes enforceable in Colorado?

Mostly not. C.R.S. § 8-2-113(2)(a) voids covenants that restrict an individual's right to receive compensation for labor, except for highly compensated workers whose covenant protects trade secrets and a few other statutory categories.

What is the Colorado non-compete salary threshold for 2026?

The Division of Labor Standards and Statistics lists the highly compensated figure at $130,014 a year for 2026 (2026 PAY CALC Order, 7 CCR 1103-14). The worker must meet it both when the covenant is signed and when it is enforced (C.R.S. § 8-2-113(2)(b)).

Are customer non-solicitation agreements legal in Colorado?

Only for workers earning at least 60 percent of the highly compensated threshold at signing and enforcement, and only if no broader than reasonably necessary to protect trade secrets (C.R.S. § 8-2-113(2)(d)).

Does my employer have to give me notice of a non-compete in Colorado?

Yes. Under C.R.S. § 8-2-113(4), the covenant is void unless notice is given in a separate signed document before a new hire accepts the offer, or at least 14 days ahead for a current worker.

Are non-competes for doctors banned in Colorado?

For covenants entered into or renewed on or after August 6, 2025, the earnings exceptions do not apply to covenants restricting the practice of medicine, advanced practice registered nursing or dentistry, so the general rule of voidness governs (SB 25-083; C.R.S. § 8-2-113(2)(b), (2)(d)).

Can a Colorado employer make me sue in another state over a non-compete?

Not if you primarily resided or worked in Colorado at termination. C.R.S. § 8-2-113(6) bars requiring you to adjudicate enforceability outside Colorado, and applies Colorado law to a worker who primarily resided and worked in the state.

What is the penalty for an illegal non-compete in Colorado?

Under C.R.S. § 8-2-113(8), an employer that presents or tries to enforce a void covenant is liable for actual damages and a $5,000 penalty per worker harmed, which a court may reduce or waive if the employer proves good faith.

Does a Colorado non-compete still apply if I was fired?

The statute does not distinguish firing from quitting, but the pay threshold must be met again when the covenant is enforced (C.R.S. § 8-2-113(2)(b)).

Can my employer make me repay training costs in Colorado?

Only within C.R.S. § 8-2-113(3)(a): the reasonable cost of training distinct from normal on-the-job training, declining proportionately over two years after the training, subject to Attorney General rules.

Does the FTC non-compete ban apply in Colorado?

No. A federal court set the FTC rule aside on August 20, 2024, and the FTC removed it from the Code of Federal Regulations on February 12, 2026; Colorado's own statute governs.