Noncompete well dries up in Colorado

On May 10, Colorado legislators approved HB22-1317, a bill that will effectively move the state into line with California and other states restricting the use of noncompetition covenants in the workplace except for highly paid workers. Governor Jared Polis has indicated he will sign the bill, so it likely will become effective in early August 2022, 90 days after the legislature adjourns.

What new legislation does

While we have been monitoring the narrowing landscape for noncompete use around the country, the passage of the 2022 Colorado bill marks a sea-change for this area of law in the Rockies. Here’s what the bill does in a nutshell:

Voids most noncompetes except for limited exceptions. Any employment agreement with a Colorado worker executed after the law’s effective date that contains restrictive covenants (including both nonsolicitation and noncompetition restrictions) is generally “void” except: