It’s important to understand what kind of non-compete agreement New Mexico businesses may craft to protect their interests. New Mexico non-compete agreements hold employees accountable for taking trade secrets and intellectual property to company competitors. Below, you can learn more about New Mexico non-competes, including whether non-compete agreements are enforceable in New Mexico.
Is a Non-Compete Legally Enforceable in New Mexico?
Yes, employers can enforce non-compete agreements in New Mexico. However, it’s up to the court system to determine whether a specific agreement is reasonable. For example, non-compete agreements set up to completely restrict a former employee’s ability to be gainfully employed in his or her trade aren’t likely to pass the reasonability test. Therefore, employers must word these contracts carefully to avoid overreaching and making them null and void.
Here are a few considerations you should keep in mind:
- Employee has to receive some consideration in return for agreeing to a non-compete.
- New Mexico non-compete agreement geographical limitations aren’t set in stone. However, they must be reasonable. Additionally, you can only impose reasonable time restraints during which an employee cannot compete with your business.
- Certain healthcare providers cannot bind employees under New Mexico law [1]
Do non-compete agreements hold up in New Mexico? Yes, they hold up if reasonable in time, scope, and geographical distance.
What’s Protected?
A New Mexico non-compete agreement places limitations on where and for whom employees can work during employment and following termination from their employer. They exist to protect businesses’ legitimate rights. However, there are limits to the geographical and time constraints imposed.
In New Mexico, non-compete agreements hold the following protections for your company:
- Maintaining workforce
- Limitation of competition
- Customer relationships
Reasonable Use and Exemptions
In New Mexico, the reasonable test for non-compete contracts considers the legitimate interests of the employer, employee, and public.
Exemptions to this law include healthcare practitioners such as physicians, certified registered nurses, dentists, osteopathic physicians, podiatrists, and anesthesiologists.
- Enforceable when terminated without cause? Not decided
- Employee non-solicitation agreement permitted? Yes
- Customer non-solicitation agreements permitted? Yes
- Does continuing employment equal sufficient consideration? Yes
Non-Compete Agreement New Mexico Limitations
Non-compete agreements in the state have limitations on time and geographical distance.
Limitations on time
The time limit, while not fixed by state law, is contingent on a standard of reasonability.
Non-compete agreement New Mexico geographical limitations
The New Mexico non-compete laws do not specify the specific geographic region or time limits for these contracts. However, it’s important to consider what would be reasonable given the circumstances and if it is narrowly tailored enough to only protect legitimate business interests.
New Mexico Non-Compete Agreement Sample
Below, you can download a non-compete agreement New Mexico template in PDF or Word format:
