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

New Mexico has no general statute on employee non-competes, so for most workers a non-compete is enforceable if its restrictions are reasonable (Lovelace Clinic v. Murphy, 1966-NMSC-165; KidsKare, P.C. v. Mann, 2015-NMCA-064). Health care is the exception. Under NMSA 1978, Section 24A-4-2 (formerly Section 24-1I-2), a non-compete that restricts one of ten listed health care practitioners from providing clinical health care services in New Mexico becomes unenforceable when the agreement or the practitioner's employment ends.

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 New Mexico's common-law reasonableness test for employee non-competes and the health care practitioner statute, NMSA 1978, Chapter 24A, Article 4, with a short note on the federal FTC rule. It does not cover trade-secret claims (see New Mexico trade secret laws), severance pay (see New Mexico severance pay laws), or covenants made in the sale of a business.

Are non-competes enforceable in New Mexico?

For most workers, yes, if they are reasonable. New Mexico has no statute that governs non-competes for employees in general; a search of the state's statutes found only the health care practitioner law and an antitrust provision unrelated to employment. That search was by keyword rather than a chapter-by-chapter review.

The rule comes from the courts. In Lovelace Clinic v. Murphy, 1966-NMSC-165, 76 N.M. 645, the New Mexico Supreme Court said covenants not to compete "will be enforced when they are reasonable, as applied to the covenantor, the covenantee, and the general public." The court also said that restricting competition, and some compulsion on an employee to stay, are "legitimate purposes, so long as the restrictions are reasonable."

The Court of Appeals restated the rule in KidsKare, P.C. v. Mann, 2015-NMCA-064: a covenant is "enforceable, if the restrictions thus imposed . . . are reasonable," and "Whether there is a reasonable restraint depends on the facts of a particular case."

No New Mexico statute caps the length or territory of a non-compete for ordinary employees. The two cases show the kind of restrictions courts have upheld: three years within Bernalillo County for a physician in Lovelace, and one year within 30 miles for a dentist in KidsKare. Both were health care workers, and both cases predate the practitioner statute described below, so neither result describes how a covered practitioner's covenant is treated today.

What a court does with an overbroad non-compete

New Mexico has no statute on rewriting an overbroad covenant. In KidsKare, the employment agreement itself said overbroad provisions could be amended "to the maximum extent deemed reasonable," and the Court of Appeals affirmed the trial court's reduction of a 100-mile radius to 30 miles on that basis. The court expressly did not decide whether New Mexico law lets a judge reform a covenant when the contract has no such clause. That question remains open in the decisions we reviewed.

Health care practitioners: NMSA 24A-4

New Mexico's practitioner statute, originally enacted as Chapter 24, Article 1I and now compiled as Chapter 24A, Article 4, covers ten professions. Section 24A-4-1 defines "health care practitioner" as:

• a dentist
• an osteopathic physician
• a physician
• a podiatrist
• a certified registered nurse anesthetist
• a certified nurse practitioner
• a certified nurse-midwife
• a psychologist
• a physician assistant
• a pharmacist

An "agreement" under the statute is a written contract to which a health care practitioner is a party.

The statute quotes on this page come from the official compilation's text as retrieved on July 30, 2026; confirm the current wording at nmonesource.com before relying on it.

What the statute does

Section 24A-4-2(A) provides:

"A non-compete provision in an agreement, which provision restricts the right of a health care practitioner to provide clinical health care services in this state, shall be unenforceable upon the termination of: (1) the agreement; (2) a renewal or extension of the agreement; or (3) a health care practitioner's employment with a party seeking to enforce the agreement."

The text does not distinguish between a practitioner who quits and one who is fired; it applies on termination of the agreement or the employment.

Which agreements it reaches

According to the applicability section as compiled, the statute applies to agreements, renewals and extensions executed on or after July 1, 2015. The out-of-state law and forum rule below applies to agreements executed on or after April 6, 2017. For psychologists, physician assistants and pharmacists, it applies to agreements executed on or after the effective date of SB 106 (2023), which took effect immediately when the governor signed it on April 4, 2023.

The statute does not apply to agreements between health care practitioners who are shareholders, owners, partners or directors of a health care practice (Section 24A-4-5).

What stays enforceable

Section 24A-4-3 lists provisions the statute does not limit:

• Repayment terms requiring a practitioner who worked for the employer for an initial period of less than three years to repay all or part of a loan, relocation expenses, a signing bonus or other payment to relocate or establish a practice in a specified area, or recruiting, education and training expenses.
• Nondisclosure provisions relating to confidential information and trade secrets.
• Non-solicitation provisions covering the patients and employees of the party seeking to enforce the agreement, for a period of one year or less after the last date of employment.
• Any other provision that does not violate the law, including a liquidated damages provision.

Liquidated damages have a limit: "A provision in an agreement fixing unreasonably large liquidated damages is void as a penalty" (Section 24A-4-4).

Out-of-state law and forum clauses

Section 24A-4-2(B) makes a provision in an agreement for clinical health care services rendered in New Mexico "void, unenforceable and against public policy" if it makes the agreement subject to another state's laws or requires litigation arising from the agreement to be conducted in another state. We found no comparable rule for workers outside health care.

Who is not covered

The statute's list does not include registered nurses, therapists other than psychologists, veterinarians or other health workers. Those workers fall under the common-law reasonableness test. A 2025 bill that would have added veterinarians, HB 366, passed a House committee but died.

Signing a non-compete, consideration and notice

Neither the practitioner statute nor the cases reviewed for this page set a notice period, a right to consult a lawyer, a consideration rule or garden-leave pay for New Mexico non-competes. For ordinary workers, the questions courts ask are about reasonableness of time and area, as in Lovelace and KidsKare.

If you are fired or laid off

For covered practitioners, the statute applies on termination of employment without regard to who ended it. For other workers, we found no New Mexico rule that treats a fired employee differently from one who quits. For how New Mexico employment ends in general, see New Mexico at-will employment laws.

Non-solicits, confidentiality agreements and trade secrets

For covered practitioners, the statute expressly leaves in place patient and employee non-solicits of one year or less and confidentiality provisions (Section 24A-4-3). A 2023 bill that would have changed the non-solicitation rule, HB 385, died; it did not become law, and Section 24A-4-3(C) still permits those non-solicits. Trade-secret protection does not depend on a non-compete; see New Mexico trade secret laws.

Remedies and enforcement

The practitioner statute makes covered non-competes unenforceable. It contains no fine, damages award or attorney's fee provision for an employer that tries to enforce one. We found no state agency that handles non-compete complaints; disputes are decided in court.

Recent New Mexico non-compete bills

• SB 106 (2023), enacted: added psychologists, physician assistants and pharmacists to the practitioner statute. It carried an emergency clause and took effect when signed on April 4, 2023.
• HB 385 (2023), died: would have changed non-solicitation provisions in practitioner agreements; postponed indefinitely.
• HB 366 (2025), died: would have added veterinarians as health care practitioners; it was reported by committee but postponed indefinitely.
• SB 16 (2026), died: the Health Professional Autonomy Act; its text contains no non-compete language.

We found no other 2026 New Mexico non-compete bill, but the Legislature's bill index could not be searched by keyword, so this is not a complete list.

The FTC rule and New Mexico

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 the rule was removed from the Code of Federal Regulations on February 12, 2026. The FTC still brings actions against individual employers, such as its June 22, 2026 final order requiring a pest-control company to stop enforcing non-competes. See FTC non-compete ban struck down.

If you have been asked to sign

The first question is whether you are one of the ten covered practitioners and whether your agreement was executed after the date the statute reached your profession. If not, the covenant is measured by its reasonableness in time, area and scope. A lawyer licensed in New Mexico can review a specific agreement.

Related

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

Disclaimer: This article provides general legal information about New Mexico non-compete law, including the common-law reasonableness test and the health care practitioner statute, NMSA 1978, Sections 24A-4-1 to 24A-4-5, not legal advice. The information was last verified on 2026-10-08. For advice about a specific agreement, contact a legal aid office or a lawyer licensed in New Mexico.

Last updated: 2026-10-08.

Frequently Asked Questions

Are non-competes enforceable in New Mexico?

For most workers, yes, if the restrictions are reasonable (Lovelace Clinic v. Murphy, 1966; KidsKare, P.C. v. Mann, 2015). For ten listed health care practitioner types, a non-compete restricting clinical services in New Mexico is unenforceable on termination (NMSA 24A-4-2).

Are non-competes for doctors banned in New Mexico?

For physicians, osteopathic physicians and eight other listed practitioner types, a non-compete restricting clinical health care services in New Mexico is unenforceable once the agreement or employment ends (NMSA 24A-4-2(A)). The rule does not apply to practitioners who are owners, shareholders, partners or directors of the practice (NMSA 24A-4-5).

Which health care workers are covered by New Mexico's non-compete law?

Dentists, osteopathic physicians, physicians, podiatrists, certified registered nurse anesthetists, certified nurse practitioners, certified nurse-midwives, psychologists, physician assistants and pharmacists (NMSA 24A-4-1).

Can a New Mexico health care employer still enforce a non-solicit?

Yes, a non-solicitation provision covering the employer's patients and employees for one year or less after the last date of employment remains enforceable (NMSA 24A-4-3(C)).

Can my employer make me repay a signing bonus if I leave?

For covered practitioners, the statute does not limit provisions requiring repayment of a loan, relocation costs, a signing bonus, or recruiting, education and training costs when the practitioner worked for the employer for an initial period of less than three years (NMSA 24A-4-3(A)).

Can a New Mexico court rewrite an overbroad non-compete?

In KidsKare (2015), the Court of Appeals affirmed cutting a 100-mile radius to 30 miles because the contract allowed amendment; it left open whether a court may do so without such a clause.

Does the FTC non-compete ban apply in New Mexico?

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.