Are Non-Competes Enforceable in California?
Last updated: 2026-10-07 · Verified against the statutes 2026-10-07
Banned
Void for all workers, wherever signed
California voids every contract that restrains anyone from a lawful profession, trade or business, unless a narrow statutory exception applies (sale of a business, or dissolution of a partnership or LLC). The ban applies no matter how narrowly the clause is drawn and no matter where or when it was signed, and employers may not even include a void non-compete in a contract or try to enforce one. Since January 1, 2026, most 'stay-or-pay' terms that make a worker repay training or other costs on leaving are also unlawful and void.
Check a non-compete
Answer a few questions; the result cites the statute behind each point. Rules verified 2026-10-07. Saved only in your browser.
Thresholds are measured differently by state (salary, cash compensation, W-2 box 1).
Likely unenforceable
Based on what you entered, a California court would most likely refuse to enforce this non-compete.
- California: Void for all workers, wherever signed. Cal. Bus. & Prof. Code 16600
Other California rules to check
- Notice and timing: Employers had to send current employees, and former employees employed after January 1, 2022, an individualized written notice that any non-compete was void by February 14, 2024 (B&P 16600.1).
- Choice of law and venue: A void non-compete is unenforceable regardless of where it was signed (B&P 16600.5). An employer may not require an employee who primarily lives and works in California to litigate California claims elsewhere or give up California law, unless the employee was individually represented by counsel (Labor Code 925).
- If a court finds it too broad: Not applicable — covenant is void.
- Penalties: Entering into or trying to enforce a void non-compete is a civil violation; employees can sue for an injunction, actual damages and attorney's fees (B&P 16600.5). Failing to give the 2024 notice is unfair competition (B&P 16600.1).
General information, not legal advice. Enforceability also depends on the exact wording, the employer's legitimate interest and the facts; talk to an employment lawyer before relying on it.
California non-compete rules
- Statute
- Cal. Bus. & Prof. Code 16600Cal. Bus. & Prof. Code 16600.1Cal. Bus. & Prof. Code 16600.5Cal. Bus. & Prof. Code 16608 (stay-or-pay)Cal. Labor Code 925 (choice of law / venue)
- Notice and timing
- Employers had to send current employees, and former employees employed after January 1, 2022, an individualized written notice that any non-compete was void by February 14, 2024 (B&P 16600.1).
- Choice of law / venue
- A void non-compete is unenforceable regardless of where it was signed (B&P 16600.5). An employer may not require an employee who primarily lives and works in California to litigate California claims elsewhere or give up California law, unless the employee was individually represented by counsel (Labor Code 925).
- Overbroad covenants
- Not applicable — covenant is void
- Penalties
- Entering into or trying to enforce a void non-compete is a civil violation; employees can sue for an injunction, actual damages and attorney's fees (B&P 16600.5). Failing to give the 2024 notice is unfair competition (B&P 16600.1).
Recent and pending changes
- January 1, 2026: AB 692 (B&P 16608, Labor Code 926): contract terms requiring a worker to repay a debt, training or other costs, or pay a fee, upon leaving a job are unlawful and void for contracts entered into on or after this date, with exceptions (e.g., transferable-credential tuition and properly structured sign-on bonuses). Cal. Bus. & Prof. Code 16608
- February 14, 2024: Deadline for employers to notify current and certain former employees that their non-competes are void. Cal. Bus. & Prof. Code 16600.1
- January 1, 2024: B&P 16600.5 and 16600.1 take effect: void covenants unenforceable wherever signed; private right of action with attorney's fees; 16600 to be read broadly per Edwards v. Arthur Andersen. Cal. Bus. & Prof. Code 16600.5
Federal law
There is no federal ban on employee non-competes. The FTC's 2024 Non-Compete Clause Rule (16 CFR Part 910), which would have voided most non-competes from September 4, 2024, never took effect: a Texas federal court set it aside nationwide on August 20, 2024 (Ryan LLC v. FTC). On September 5, 2025 the Commission voted 3-1 to drop its appeals and accept that ruling, and on February 12, 2026 it formally removed Part 910 from the Code of Federal Regulations. State law therefore decides whether a non-compete is enforceable.
Frequently asked questions
Are non-competes enforceable in California?
Void for all workers, wherever signed. California voids every contract that restrains anyone from a lawful profession, trade or business, unless a narrow statutory exception applies (sale of a business, or dissolution of a partnership or LLC). The ban applies no matter how narrowly the clause is drawn and no matter where or when it was signed, and employers may not even include a void non-compete in a contract or try to enforce one. Since January 1, 2026, most 'stay-or-pay' terms that make a worker repay training or other costs on leaving are also unlawful and void.
Did the FTC ban non-competes in California?
No. The FTC's 2024 rule never took effect — a federal court set it aside in August 2024, the FTC dropped its appeals in September 2025 and removed the rule from the Code of Federal Regulations in February 2026. State law controls, though the FTC still challenges some non-competes case by case.
Official Sources
Figures checked against these sources on 2026-10-07Other states
Same category (Banned): Minnesota, North Dakota, Oklahoma
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Not legal advice. Enforceability depends on the agreement's wording and the facts; consult an employment attorney licensed in California.