Non-Compete Agreements in Utah: Are They Enforceable?

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Non-compete agreements are often a hot topic in Utah employment law. Many employers want to protect their business from unfair competition when an employee leaves, while many employees worry about being unable to find work in their chosen field.

So, are non-compete agreements in Utah actually enforceable? The short answer is sometimes. Utah law allows them in limited situations—but they must follow strict rules to be valid. Let’s break it down in simple terms.

What Is a Non-Compete Agreement?

A non-compete agreement (often called a “covenant not to compete”) is a contract between an employer and an employee. It usually says that after leaving the company, the employee cannot work for a competing business or start their own similar company for a certain period of time.

For example, if you work at a tech company in Logan, your employer might ask you to sign a contract saying you can’t work for another tech company within Cache Valley for one year after leaving your job.

These agreements are meant to protect employers’ confidential information, trade secrets, and customer relationships. But they also limit an employee’s freedom to work—and Utah law tries to balance those two interests carefully.

Utah’s Law on Non-Competes

Utah has a specific law called the Utah Post-Employment Restrictions Act, found in Utah Code § 34-51-101, which sets clear rules for when a non-compete can be enforced.

Here’s what the law says in plain language:

1. Time Limit

A non-compete agreement in Utah cannot last longer than one year after employment ends.
If the agreement tries to last longer than that, the whole thing is void—meaning it can’t be enforced at all.

2. Written and Agreed To

The agreement must be in writing and must be mutually agreed to by both employer and employee. A verbal promise isn’t enough.

3. Part of Employment or Severance

Non-competes are usually signed:

• At the start of employment, as part of the hiring process, or
• At the end of employment, if tied to a severance package or other benefit.

If an employer tries to sneak a non-compete in after you’ve already started working—without giving you anything in return—it may not hold up.

4. Reasonable in Scope

Even if a non-compete is for less than one year, it must still be reasonable in its restrictions. That means:

• The geographic area (like a city or region) can’t be too large, and
• The type of work restricted can’t be overly broad.

A rule that prevents you from doing any job in an entire industry might be seen as unfair and unenforceable.

5. Exceptions for Some Industries

Certain professions—like doctors, broadcasters, or tech workers—may have specific limits or exceptions under Utah law or federal guidance. For instance, many health care providers face special ethical rules about patient access that affect how non-competes work.

What Happens If a Non-Compete Violates Utah Law?

If an employer tries to enforce a non-compete that breaks these rules, the employee can sue for damages.

Utah law allows employees to recover:

• Lost wages,
• Attorney fees, and
• Court costs.

That means a company could end up paying a lot more than it gains by overreaching with an illegal non-compete.

Employers should therefore be very careful to write clear, narrow, and lawful agreements—and employees should never assume a non-compete is automatically enforceable just because it’s in a contract.

Non-Solicitation vs. Non-Compete Agreements

It’s also important to understand that non-solicitation agreements are different from non-competes.

A non-solicitation clause usually says an employee can’t contact the company’s customers or other employees after leaving. These are often easier to enforce because they don’t stop someone from working in the same field—they just protect specific business relationships.

However, even non-solicitation agreements must be written clearly and reasonably.

Recent Developments and Federal Trends

Non-compete laws are changing nationwide. The Federal Trade Commission (FTC) has proposed a rule that could ban most non-competes in the United States. While that rule has not yet taken full effect as of 2025, it shows a strong federal push to limit restrictive employment practices.

Utah courts often interpret non-compete agreements narrowly—meaning they look for ways to limit or void them if they seem unfair or overbroad.

Because the law keeps evolving, it’s vital for both employers and employees in Utah to stay updated and get professional legal advice before signing or enforcing a non-compete.

For Employers: Writing an Enforceable Non-Compete

If you own a business in Utah and want to protect your company, here are a few best practices (in plain English):

• Keep it short: No longer than one year.
• Stay local: Limit the geographic area to where your business actually operates.
• Be specific: Only restrict roles that could actually harm your business if filled by a former employee.
• Offer something of value: Especially if the employee signs after starting work.
• Get it in writing: And make sure both sides sign.

When written carefully, a non-compete can help protect your business. When written carelessly, it can cost you in court.

For Employees: Protecting Your Right to Work

If you’ve been asked to sign a non-compete—or you already signed one—it’s important to know your rights.

You might have a valid reason to challenge it if:

• The agreement lasts more than a year,
• It covers too big of an area,
• It stops you from doing unrelated work, or
• You didn’t get anything of value in exchange for signing.

A lawyer can review the agreement and tell you whether it’s enforceable under Utah law. You might have more freedom than you think.

What Utah Courts Look At

When a dispute over a non-compete reaches a Utah court, the judge typically looks at three main questions:

1. Does the employer have a legitimate business interest?
   Protecting trade secrets or customer lists is legitimate. Preventing competition just for convenience is not.
2. Is the restriction reasonable in time, geography, and scope?
   If the limits are too harsh, the court may strike down the agreement.
3. Did both sides benefit fairly from the deal?
   If an employee signed under pressure or didn’t receive fair value, the agreement may not stand.

Utah judges don’t like overly broad contracts that keep people from earning a living. They prefer narrow, fair agreements that truly protect legitimate business interests.

Practical Example

Imagine Sarah works as a marketing director for a Salt Lake City software company. She signs a non-compete that says she can’t work in “any marketing role in Utah” for two years after leaving the company.

Sarah quits and gets a job with a local outdoor gear company doing social media marketing. Her old employer threatens to sue.

In this case, the non-compete would probably be unenforceable because:

• It lasts longer than one year,
• It covers the entire state (too broad), and
• It prevents her from working in a totally different industry.

The court would likely side with Sarah.

Why Legal Advice Matters

Both employers and employees can make serious mistakes by guessing about non-compete laws. Utah’s rules are unique and have been updated over the years. What might have been legal five years ago might not be today.

An attorney who understands Utah employment law can:

• Review your contract,
• Negotiate fair terms,
• Draft or revise agreements, and
• Represent you if a dispute arises.

Work with Walker Law Firm of Cache Valley

At Walker Law Firm of Cache Valley, attorney Matthew A. Walker helps Utah businesses and employees understand their legal rights under non-compete agreements and other employment contracts.

Our firm serves clients throughout northern Utah, including Logan, Smithfield, Brigham City, and the greater Cache Valley area.

Whether you’re an employer trying to protect your business, or an employee worried about your ability to work, we can help you find a fair and lawful solution.

We also handle matters involving:

• Estate planning
• Personal injury
• Business formation and governance
• Contracts and real estate agreements
• Guardianships and conservatorships
• Adoptions
• Appellate work

Contact Walker Law Firm of Cache Valley today to schedule a consultation. Protect your future—and make sure your contracts protect you, too.