Banned statewide
North Dakota Non-Compete Law (2026): Void by statute
North Dakota's statute is blunt: a contract that restrains anyone from exercising a lawful profession, trade or business is void to that extent, and the only survivors are covenants tied to the sale of a business's goodwill or the winding up of a partnership, LLC or corporation. That rule dates to the territorial code and has never been softened for employment. Its courts have also shut the escape hatch, refusing to honor out-of-state law and venue clauses inserted to make a covenant stick.
The rule
How North Dakota treats non-compete agreements
North Dakota's ban reaches customer non-solicitation clauses too, which is broader than most people assume and broader than several other 'ban' states. The 2019 amendment is also frequently misread as loosening the employment rule; it only adjusted the geography language inside the sale-of-business and dissolution exceptions.
If you are an employer
Build your protection around trade secret law and confidentiality obligations, since neither a noncompete nor a customer non-solicit will hold up, and do not expect a Minnesota or Delaware choice-of-law clause to rescue one.
If you are a worker
An employment noncompete signed in North Dakota is void, and that stays true even if the contract says another state's law applies.
| Classification | Longstanding statutory ban with sale-of-business and dissolution exceptions only |
|---|---|
| Pay threshold | Not applicable. The prohibition covers every employee regardless of pay or seniority. |
| Maximum term | Zero for employment covenants. The two surviving exceptions, sale of goodwill and dissolution of a partnership, LLC or corporation, must themselves be confined to a reasonable geographic area and a reasonable length of time. |
| Notice or consideration | Irrelevant. Disclosure, consideration and negotiation cannot save a void restraint. |
| Primary statute | N.D. Cent. Code § 9-08-06 |
A covenant signed in another state
North Dakota voids out-of-state choice-of-law and forum-selection clauses for workers who primarily live and work there, under Osborne v. Brown & Saenger (N.D. 2017). Signing in a friendlier jurisdiction does not rescue a covenant once North Dakota law applies.
Detail
What has changed, and what is still moving
Legislation 2024–2026
None in 2024-2026. The most recent change to § 9-08-06 was HB 1351 in 2019, which loosened the geographic wording inside the two exceptions and confirmed the section applies to corporations and LLCs. Reports of a 2025 amendment are mistaken; the 69th Legislative Assembly's SB 2135 dealt with firefighter death benefits.
Bills to watch
No significant restrictive bills pending. North Dakota's Legislative Assembly meets in odd-numbered years and takes up the 2027 session next.
Leading cases
Warner & Co. v. Solberg, 2001 ND 156, 634 N.W.2d 65, construes the statute strictly and rejects partial enforcement of employment restraints. Osborne v. Brown & Saenger, Inc., 2017 ND 288, 904 N.W.2d 34, holds that a clause selecting another state's law or courts cannot be used to sidestep § 9-08-06 and is itself unenforceable as contrary to North Dakota public policy.
If you have one in hand
What can make a non-compete unenforceable in North Dakota
- The statute itself. North Dakota voids employment non-competes, so the clause fails without any argument about how reasonable it is.
- The scope is wider than the interest behind it. A restriction that reaches beyond the customers, trade secrets or goodwill the employer can actually point to is the most common reason a covenant fails in North Dakota.
Whether any of these applies turns on the wording of your own agreement, your role and the case law your court follows. This page maps the statutory landscape; it does not replace advice on a specific contract.
FAQ
North Dakota non-compete questions
Are non-compete agreements enforceable in North Dakota?
North Dakota's statute is blunt: a contract that restrains anyone from exercising a lawful profession, trade or business is void to that extent, and the only survivors are covenants tied to the sale of a business's goodwill or the winding up of a partnership, LLC or corporation. That rule dates to the territorial code and has never been softened for employment. Its courts have also shut the escape hatch, refusing to honor out-of-state law and venue clauses inserted to make a covenant stick.
How long can a non-compete last in North Dakota?
No length is enforceable. North Dakota voids employment non-competes whatever their duration, so a three-month restriction fails on the same ground as a three-year one. The exceptions are tied to ownership, not employment.
Is there a minimum salary for non-competes in North Dakota?
No, and it would not help. The North Dakota ban is pay-blind: it protects a minimum-wage worker and a senior executive on exactly the same terms.
What notice or consideration does North Dakota require?
Irrelevant. Disclosure, consideration and negotiation cannot save a void restraint.
Can an out-of-state employer enforce a non-compete against a North Dakota worker?
Often not. North Dakota voids out-of-state choice-of-law and forum-selection clauses for workers who primarily live and work there, under Osborne v. Brown & Saenger (N.D. 2017). A covenant signed elsewhere can still fail once North Dakota law applies.
Sources
How this entry was checked
- Primary source. N.D. Cent. Code § 9-08-06 — the statutory text itself.
- Secondary sources consulted. N.D. Cent. Code § 9-08-06, N.D. Legislative Branch, Warner & Co. v. Solberg, Osborne v. Brown & Saenger, Fredrikson & Byron, SW&L Attorneys.
Check it against a third party
None of these is ours. If a figure here matters to a decision, verify it:
- Federal Trade Commission — non-compete hub
- Economic Innovation Group — State Noncompete Law Tracker
- Fair Competition Law (Beck Reed Riden) — 50-state legislation tracker
- GAO-23-103785 — Noncompete Agreements (May 2023)
This page is general legal information published by Jurizmo and is not legal advice, does not create an attorney-client relationship, and may not reflect amendments enacted after the review date above. Consult a licensed attorney in the relevant state before acting on any agreement.