Pay-threshold ban
Oregon Non-Compete Law (2026): Void below roughly $120K
Oregon has turned non-compete enforceability into a compliance checklist rather than a judgment call. Five conditions all have to be satisfied: two weeks' written warning before the job starts or a real promotion at signing, exempt white-collar status, a demonstrable protectable interest, pay above an inflation-adjusted floor that reached $119,541 in 2026, and delivery of a signed copy within a month of departure. Miss any one and the covenant is void, not merely narrowed. Even then the restriction expires twelve months after the worker leaves.
The rule
How Oregon treats non-compete agreements
The garden-leave provision is the practical workaround and it is expensive. An employer that wants to bind a worker who falls short of the threshold must promise, in writing at signing, to pay during the restricted period the greater of half the worker's annual gross base salary plus commissions or half the statutory threshold. Because the covenant is void rather than voidable for agreements dating from 2022 forward, a worker does not need to take any affirmative step to escape it.
If you are an employer
Treat ORS 653.295 as a five-box checklist rather than a reasonableness standard, and calendar the 30-day post-termination copy obligation, because a covenant that clears the salary test can still die on a paperwork failure.
If you are a worker
Look first at the calendar and the offer letter rather than the covenant's wording: if you earned under $119,541 in 2026, were non-exempt, or never got the two-week written warning before your start date, the restriction is void as written.
| Classification | Indexed income-threshold ban with a hard 12-month ceiling |
|---|---|
| Pay threshold | $119,541 for 2026, measured as annual gross salary plus commissions at termination. The statutory base is $100,533 and it is re-indexed every year to the CPI-U for the West Region; the 2025 figure was $116,427 and the 2024 figure was $113,241. |
| Maximum term | 12 months from the termination date, written into ORS 653.295 as an absolute ceiling. A longer term is not trimmed; the covenant simply cannot run past the twelfth month. |
| Notice or consideration | Yes, and it is one of the strictest notice rules in the country. The employer must tell the applicant in writing, at least two weeks before the first day of work, that a non-compete is a condition of the job. The only alternative is to sign the covenant at the moment of a genuine promotion. A separate obligation requires the employer to hand the departing worker a signed written copy of the covenant within 30 days of termination. |
| Primary statute | Or. Rev. Stat. § 653.295 (exempt-employee definition cross-referenced at ORS 653.020(3)); medical-practice covenants additionally governed by 2025 Or. Laws ch. 264 (SB 951) |
Detail
What has changed, and what is still moving
Legislation 2024–2026
The 2021 amendment (effective January 1, 2022) cut the maximum term from 18 months to 12, converted non-conforming covenants from voidable to void, and installed the indexed salary floor. In 2025 the legislature added SB 951, signed and effective June 9, 2025, which regulates corporate control of medical practices and limits the restrictive covenants and confidentiality terms that management service organizations can impose on physicians, nurse practitioners, physician associates, and naturopaths.
Bills to watch
No significant restrictive bills pending
Leading cases
ORS 653.295 now answers nearly every question that used to be litigated, and courts treat non-compliance as fatal rather than as a factor to weigh. Pre-2022 reasonableness decisions retain force only for covenants signed before the statute's current form took hold, and for issues the statute leaves open such as the scope of a protectable interest.
If you have one in hand
What can make a non-compete unenforceable in Oregon
- You earn below the threshold. $119,541 for 2026, measured as annual gross salary plus commissions at termination. The statutory base is $100,533 and it is re-indexed every year to the CPI-U for the West Region; the 2025 figure was $116,427 and the 2024 figure was…
- The employer skipped a required step. Yes, and it is one of the strictest notice rules in the country. The employer must tell the applicant in writing, at least two weeks before the first day of work, that a non-compete is a condition of the job. The only alternative is to…
- 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 Oregon.
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
Oregon non-compete questions
Are non-compete agreements enforceable in Oregon?
Oregon has turned non-compete enforceability into a compliance checklist rather than a judgment call. Five conditions all have to be satisfied: two weeks' written warning before the job starts or a real promotion at signing, exempt white-collar status, a demonstrable protectable interest, pay above an inflation-adjusted floor that reached $119,541 in 2026, and delivery of a signed copy within a month of departure. Miss any one and the covenant is void, not merely narrowed. Even then the restriction expires twelve months after the worker leaves.
How long can a non-compete last in Oregon?
12 months from the termination date, written into ORS 653.295 as an absolute ceiling. A longer term is not trimmed; the covenant simply cannot run past the twelfth month.
Is there a minimum salary for non-competes in Oregon?
$119,541 for 2026, measured as annual gross salary plus commissions at termination. The statutory base is $100,533 and it is re-indexed every year to the CPI-U for the West Region; the 2025 figure was $116,427 and the 2024 figure was $113,241.
What notice or consideration does Oregon require?
Yes, and it is one of the strictest notice rules in the country. The employer must tell the applicant in writing, at least two weeks before the first day of work, that a non-compete is a condition of the job. The only alternative is to sign the covenant at the moment of a genuine promotion. A separate obligation requires the employer to hand the departing worker a signed written copy of the covenant within 30 days of termination.
Sources
How this entry was checked
- Primary source. Or. Rev. Stat. § 653.295 (exempt-employee definition cross-referenced at ORS 653.020(3)); medical-practice covenants additionally governed by 2025 Or. Laws ch. 264 (SB 951) — the statutory text itself.
- Secondary sources consulted. ORS 653.295 (Justia), Oregon BOLI noncompetition agreements guidance, Epstein Becker Green 2026 threshold survey, Fair Competition Law low-wage threshold chart (January 21, 2026), Littler Oregon threshold alert, Epstein Becker Green SB 951 analysis.
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.