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New York Non-Compete Agreement Template

New York has no general non-compete statute, so enforceability turns on a court-made reasonableness test that also weighs hardship to the employee and harm to the public. Narrow client non-solicits tied to clients the employee served tend to fare better than broad industry bans, and pending legislation could change the landscape, so keep terms tight.

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New York rules to know

  • Reasonableness test from case law

    New York has no general non-compete statute. Courts enforce a covenant only if it is no broader than needed to protect a legitimate interest, does not impose undue hardship on the employee, and does not harm the public.

    BDO Seidman v. Hirshberg, 93 N.Y.2d 382 (1999)

  • Protect secrets, clients or unique skills

    Legitimate interests are generally limited to trade secrets, confidential information, client relationships developed at the employer's expense, or an employee whose services are unique. Client non-solicits tied to clients the employee served are more likely to hold up than broad bans on working in the industry.

    BDO Seidman v. Hirshberg, 93 N.Y.2d 382 (1999)

  • Partial enforcement is not guaranteed

    Courts may partially enforce an overbroad covenant, but often refuse if the employer overreached or used coercive tactics. Some courts also decline to enforce non-competes against employees fired without cause, so keep terms narrow.

    BDO Seidman v. Hirshberg, 93 N.Y.2d 382 (1999)

  • Watch pending ban legislation

    A bill banning most non-competes except for highly paid workers and business sales passed the State Senate in 2025 and was reintroduced in 2026, but it had not become law as of October 2026. The governor vetoed a broader ban in 2023, and the FTC's federal ban was set aside in court.

    N.Y. Senate Bill S4641-A (2025); S9759 (2026)

Last updated 2026-10-05

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What a non-compete agreement covers

  • Restricted activities and competitors
  • Duration and geographic scope
  • Non-solicitation of customers and employees
  • Consideration given for the restriction
  • Remedies and reformation
  • Governing law and venue

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Frequently asked questions

What business interests justify a non-compete in New York?
New York courts generally recognize trade secrets, confidential information, client relationships developed at the employer's expense, and employees whose services are unique. A covenant must be no broader than needed to protect one of these interests, so a clause aimed only at keeping a former employee out of the industry is unlikely to hold up.
Will a New York court fix an overbroad non-compete?
Not necessarily. New York courts may partially enforce an overbroad covenant, but they often refuse if the employer overreached or used coercive tactics. Some courts also decline to enforce non-competes against employees fired without cause. Starting with narrow, well-justified terms is the safer approach.
Has New York banned non-competes?
Not as of October 2026. A bill banning most non-competes, except for highly paid workers and business sales, passed the State Senate in 2025 and was reintroduced in 2026 but had not become law. The governor vetoed a broader ban in 2023, and the FTC's federal ban was set aside in court.
Are non-competes enforceable?
It depends heavily on the state. A few states ban most employee non-competes outright, others cap them by salary, duration or industry, and many enforce only restrictions that are reasonable in time, area and scope.
What's the difference between a non-compete and a non-solicit?
A non-compete stops someone working for a competitor or starting a competing business. A non-solicit only stops them from poaching your customers or staff. Non-solicits are enforceable in more places, but not everywhere.
Can I use a non-compete when selling my business?
Usually yes. Sale-of-business non-competes are treated much more favourably than employee ones, even in states that otherwise ban non-competes.

Non-Compete Agreement in other states

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