Minnesota Bans Most Non-Compete Agreements (7/1/23)

​On May 24, 2023, Minnesota Governor Tim Walz signed into law a sweeping omnibus jobs and economic development and labor funding bill that will invest $500 million in a fund to match federal investments in infrastructure and large-scale development projects. This bill also fundamentally changes several areas of Minnesota employment law, including instituting a ban on employer-employee noncompete agreements signed after July 1, 2023.

Read the article:
Minnesota Governor Signs Labor Funding, Noncompete Ban Bill Into Law
Ogletree | May 2023

Effective date:  7/1/23
Text of the measure.

Additional Articles

Customer non-solicitation and employee non-solicitation agreements are not impacted (but if the provision functions like a noncompete, it will be banned even if it is called a non-solicit).
Doing Business in Minnesota? Six Things Employers Should Know About the New Noncompete Ban
Snell | May 2023

Significantly, there is no compensation threshold, or any exception for executives or other “exempt” employees. This statute is a total ban on non-competes with workers, with limited statutory exceptions.
Minnesota Joins the “Ban”-wagon, Barring Most Non-Competes with Workers
Blank Rome | Jun 2023

Notably, non-solicitation and non-interference agreements and clauses are permitted under the statute. Both provide the protections that are often the motivating factors for the more restrictive non-competition clauses—preventing former employees from stealing a company’s employees, customers, and prospects, and interfering with current business relationships.
Governor Walz Signs into Law Non-Compete Ban in Minnesota
Husch | Jun 2023