Occupation limits
Pennsylvania Non-Compete Law (2026): Enforceable with carve-outs
For most Pennsylvania workers the question is still what a judge thinks is reasonable in time, territory, and activity, weighed against the employer's legitimate interest and the burden on the employee. Pennsylvania courts describe non-competes as disfavored restraints and say so out loud, which gives employees real room to argue. Medicine is now carved out by statute: since January 1, 2025 a covered practitioner who resigns can be held to no more than twelve months, and a practitioner the employer let go cannot be held at all.
The rule
How Pennsylvania treats non-compete agreements
Act 74 does not blanket-ban medical non-competes. It leaves untouched covenants attached to a sale of ownership interest, a sale of substantially all assets, or a change of control, and it preserves clauses that recoup reasonable relocation, training, and patient-base establishment costs so long as those costs are amortized over five years or less. The patient-notification duty is easy to overlook: within 90 days of a departure the employer must write to patients seen in the previous year who had an ongoing outpatient relationship of at least two years, telling them the practitioner has left, how to move their records, and that they may be reassigned within the organization.
If you are an employer
Two Pennsylvania-specific traps deserve calendar entries: an incumbent employee needs genuine new consideration before signing, and if you employ physicians or advanced practitioners, firing one wipes out the covenant and starts a 90-day clock to notify their longstanding patients.
If you are a worker
Ask when you signed and what you got for it, since a covenant an existing employee signed for nothing is unenforceable in Pennsylvania, and if you are a covered health-care practitioner who was dismissed, the restriction is void no matter what it says.
| Classification | Judge-made reasonableness, overlaid by a 2024 health-care practitioner ban |
|---|---|
| Pay threshold | No pay threshold |
| Maximum term | No general ceiling. Courts assess duration as one factor in the reasonableness inquiry, and terms in the one-to-two-year band are the ones most often sustained. Covered health-care practitioners are different: Act 74 caps enforceable covenants at one year, and only when the practitioner left voluntarily. |
| Notice or consideration | No advance-notice statute. Pennsylvania's distinctive rule is about consideration rather than timing: a new hire is bound by the offer of employment itself, but an incumbent asked to sign later must receive something of real value in exchange, such as a raise, a promotion, or a bonus. |
| Primary statute | No general non-compete statute; common law controls. Health-care practitioners are governed by the Fair Contracting for Health Care Practitioners Act, Act of July 17, 2024, P.L. 846, No. 74 (HB 1633). |
Detail
What has changed, and what is still moving
Legislation 2024–2026
Act 74 of 2024, the Fair Contracting for Health Care Practitioners Act, took effect January 1, 2025 and applies to covenants executed on or after that date. It reaches medical doctors, doctors of osteopathy, certified registered nurse anesthetists, certified registered nurse practitioners, and physician assistants. A covenant against a covered practitioner cannot run longer than one year, and it cannot be enforced at all if the employer dismissed the practitioner. The Act also directs the Health Care Cost Containment Council to study non-compete prevalence; that study drew public comment in the fall of 2024.
Bills to watch
HB 2558 (2025-2026 session) would prohibit non-competes in broadcast employment agreements. It cleared the House 103-99 on July 1, 2026 and sits with the Senate Labor and Industry Committee as of July 9, 2026. Broader general-workforce bans have been introduced in the same session without advancing.
Leading cases
Hess v. Gebhard & Co., 808 A.2d 912 (Pa. 2002), sets the modern framework and confirms that a covenant must be incident to an employment relationship and supported by adequate consideration. Insulation Corp. of America v. Brobston, 667 A.2d 729 (Pa. Super. 1995), is the case employees cite most, holding that an employer's decision to fire a worker for poor performance undercuts the claim that the worker poses a competitive threat worth restraining. Rullex Co. v. Tel-Stream, Inc., 232 A.3d 620 (Pa. 2020), governs timing, requiring that a covenant signed after the start of employment be supported by fresh consideration unless the parties clearly intended to be bound from the outset.
If you have one in hand
What can make a non-compete unenforceable in Pennsylvania
- Your occupation is carved out. Judge-made reasonableness, overlaid by a 2024 health-care practitioner ban
- 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 Pennsylvania.
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
Pennsylvania non-compete questions
Are non-compete agreements enforceable in Pennsylvania?
For most Pennsylvania workers the question is still what a judge thinks is reasonable in time, territory, and activity, weighed against the employer's legitimate interest and the burden on the employee. Pennsylvania courts describe non-competes as disfavored restraints and say so out loud, which gives employees real room to argue. Medicine is now carved out by statute: since January 1, 2025 a covered practitioner who resigns can be held to no more than twelve months, and a practitioner the employer let go cannot be held at all.
How long can a non-compete last in Pennsylvania?
No general ceiling. Courts assess duration as one factor in the reasonableness inquiry, and terms in the one-to-two-year band are the ones most often sustained. Covered health-care practitioners are different: Act 74 caps enforceable covenants at one year, and only when the practitioner left voluntarily.
Is there a minimum salary for non-competes in Pennsylvania?
No. Pennsylvania sets no income floor, so pay alone does not decide whether a covenant binds you. The test is whether the restriction goes further than the employer's legitimate interest requires in time, geography and scope of work.
What notice or consideration does Pennsylvania require?
No advance-notice statute. Pennsylvania's distinctive rule is about consideration rather than timing: a new hire is bound by the offer of employment itself, but an incumbent asked to sign later must receive something of real value in exchange, such as a raise, a promotion, or a bonus.
Sources
How this entry was checked
- Primary source. No general non-compete statute; common law controls. Health-care practitioners are governed by the Fair Contracting for Health Care Practitioners Act, Act of July 17, 2024, P.L. 846, No. 74 (HB 1633). — the statutory text itself.
- Secondary sources consulted. Act of July 17, 2024, P.L. 846, No. 74 (Justia), Ballard Spahr Act 74 alert, Buchanan Ingersoll & Rooney Act 74 alert, Jackson Lewis health-care non-compete analysis, Pennsylvania General Assembly HB 2558 record, LegiScan PA HB 2558, PORH/PHC4 Act 74 study notice.
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.