Colorado Employment Contracts & Non-Competes
Non-compete enforceability, severance agreements, and contract issues under Colorado employment law.
Non-Compete Agreements
Non-competes heavily restricted (effective August 10, 2022; subsequently amended in 2025); void unless the worker earns at least the threshold amount for highly compensated workers determined by the Division of Labor Standards and Statistics (adjusted annually) both when the covenant is entered into and when it is enforced, and the covenant is for the protection of trade secrets and no broader than reasonably necessary; customer non-solicitation covenants require annualized cash compensation of at least a lower percentage of that threshold; certain health-care practice covenants are treated differently; employers must provide notice of the covenant and its terms in a separate, worker-signed document before a prospective worker accepts the offer, or a specified period before the covenant or the consideration for it takes effect for a current worker; confirm current thresholds and notice timing with a lawyer. §8-2-113.
Key Non-Compete Factors
| What Courts Examine | |
|---|---|
| Duration | Whether the time restriction is reasonable |
| Geographic Scope | Whether the area restriction matches the employer's legitimate business area |
| Scope of Activity | Whether the restricted activities are narrowly tailored |
| Consideration | Whether the employee received adequate consideration for signing |
| Hardship | Whether enforcement would impose undue hardship on the employee |
Severance Agreements
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