Non-compete agreements are allowed in Minnesota. Courts will enforce non-compete agreements that are reasonably drawn to protect the interest of the employer, and in securing the right of employees to pursue work in an open labor market. Learn more about using a non-compete agreement in Minnesota below and download a free template.
Is a Non-Compete Agreement Legally Enforceable in Minnesota?
Yes, non-compete agreements are legally enforceable in Minnesota, but only if they meet certain requirements. The non-compete must be fair to both parties and should only be used if necessary.
What Can Be Protected?
In Minnesota, a non-compete agreement must be no broader than necessary to protect the employer’s legitimate business interest. A non-compete agreement must not impose any unnecessary hardship on the employee.
Reasonable Uses and Objections
- Enforceable when terminated without cause? Yes
- Employee non-solicitation agreement permitted? Yes
- Customer non-solicitation agreements permitted? Yes
- Does continuing employment equal sufficient consideration? Yes
- Statute of Limitations for breach of contract: 6 years
Minnesota Non-Compete Limitations
Time limitations:
Minnesota courts routinely scrutinize agreements to ensure they are reasonable as to time. Time limits of one or two years are frequently upheld. Limits on using customer lists or non-solicitation of customers are sometimes found valid without time limits but these restrictions must be carefully written.
Geographical limitations:
In the case of highly specialized sales personnel, Minnesota courts have upheld non-compete agreements with no geographical limitations. The circumstances of the case were unique, however, and a geographical limitation of the non-compete agreement is probably prudent to consider when drafting any agreement. See, Medronic, Inc. v. Hughes (Minn. App. 2011). [1]
Other limitations:
If an employee does not take employment with a direct competitor, many Minnesota courts will view any attempt to enforce a non-compete agreement unfavorably.
Minnesota Non-Compete Agreement Sample
This example of a Minnesota non-compete agreement will let you draft up-to-date agreements for your business clearly, simply, and inexpensively.
Non-Compete Agreement
