A Colorado non-compete agreement is a written contract in which a worker promises not to compete with an employer, or not to solicit its customers, after employment ends. Colorado sets the rules in Section 8-2-113 of the Colorado Revised Statutes. They cover physicians, sales of a business, highly paid workers, written notice and the place where a dispute is heard.[1] Employers can also start from the general non-compete agreement template.
Last Updated: October 2026. This guide is reviewed and updated regularly to reflect current Colorado law. If you notice an error or outdated information, please contact us.
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A non-compete, also called a covenant not to compete, is a promise that limits where or for whom a worker may work after leaving a job. Colorado regulates these covenants in Section 8-2-113 of the Colorado Revised Statutes. The statute voids some of these promises, such as those between physicians, and sets conditions for others, such as those with higher-paid workers or those that only bar solicitation of customers. It also covers written notice, governing law and where a dispute can be heard.[1]
| Situation | What the statute says |
|---|---|
| Physicians | A restriction on practicing medicine after the agreement ends is void. |
| Higher-paid workers | An exception applies at or above a set pay threshold, with limits. |
| Customer solicitation | An exception applies at sixty percent of that threshold or more, with limits. |
| Sale of a business | A separate rule applies. |
| Disputes | State law governs, and the worker cannot be made to litigate outside the state. |
Under Section 8-2-113(2)(a), a covenant not to compete that restricts a worker's right to be paid for work is void unless it fits one of the statute's exceptions. Those are the highly compensated worker and customer non-solicitation exceptions below, plus the covenants the statute does not prohibit at all: recovery of the cost of special training, a reasonable confidentiality provision, a covenant for the purchase and sale of a business or its assets, and repayment of an apprenticeship scholarship (Section 8-2-113(3)).[1]
One of those allowed clauses lets an employer recover the cost of training that is distinct from normal on-the-job training. The recovery is limited to the reasonable cost of the training and shrinks month by month over the two years after the training ends (Section 8-2-113(3)(a)).[1]
Section 8-2-113 makes an exception for a worker who earns annualized cash compensation (yearly pay in cash) at or above a set threshold. The worker must meet that threshold when the promise is made and when it is enforced. The promise must also protect trade secrets. It can be no broader than reasonably necessary to protect the employer's legitimate interest in them.[1]
A promise that bars solicitation of customers has a lower threshold. The worker must earn annualized cash compensation of at least sixty percent of the threshold for highly compensated workers. The worker must meet that level when the promise is made and when it is enforced. It can be no broader than reasonably necessary for the employer's legitimate interest in protecting trade secrets.[1]
A restriction made in connection with the sale of a business has its own rule under the statute. The statute names a promise tied to the purchase and sale of a business, or of its assets, as a separate category.[1]
A current worker must get notice of the promise at least fourteen days before the earlier of two dates:
The worker must sign the notice.[1] You can count the fourteen days with our deadline calculator.
A prospective worker must get the notice before accepting the offer, and every notice must be a separate document from any other covenants, in clear and conspicuous terms in the language the employer and worker use to discuss the worker's performance. A covenant without the required notice is void (Section 8-2-113(4)).[1]
Colorado law governs a non-compete for a worker who primarily lived and worked in Colorado when employment ended, even if the contract says otherwise. The contract may not require that worker to adjudicate (settle in court) its enforceability outside Colorado.[1]
Good non-compete agreements state who is bound, what is restricted, for how long and where. Employers often include the elements below. They are common drafting practice, not a checklist taken from the statute. Pair them with the Colorado rules above, including the written notice to the worker.
In practice, people drafting these agreements weigh three things. These are how long the restriction lasts, how large the area is, and whether the terms are reasonable for what the employer needs. It is also common to state the consideration in the agreement, such as added pay or a change in employment terms.
Employers who rely on a trade secret usually write down the facts behind it. Typical questions include:
Seniority, job duties and access to sensitive information are not the Colorado test. The exception turns on the worker's annualized cash compensation meeting the highly compensated threshold and on the covenant protecting trade secrets, no broader than reasonably necessary (Section 8-2-113(2)(b)).[1]
The short answers below cover questions people ask about these agreements in Colorado. Each answer is based on Section 8-2-113 of the Colorado Revised Statutes.[1] Check the current text before you sign or enforce one. For a specific situation, contact a Colorado attorney.
No. A restriction between physicians that limits a physician's right to practice medicine after the agreement ends is void. All other terms of the agreement that are enforceable at law stay enforceable. That includes terms that require payment of damages reasonably related to the injury suffered by reason of termination of the agreement.[1]
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In Colorado, a non-compete is void under Colo. Rev. Stat. § 8-2-113 unless it fits one of the statute's exceptions, such as those for highly compensated workers and the sale of a business. Learn about the most popular states requested by our website users concerning non-compete contracts.
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General information, not legal or tax advice.
The Colorado rules on this page come from the statute listed below, which covers physicians, pay thresholds, written notice, governing law and venue. Check its current version before you rely on it.
