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Can Nevada businesses still enforce non-compete agreements?

On Behalf of | Feb 1, 2025 | BUSINESS & COMMERCIAL LAW - Contract Disputes

Non-compete agreements are a type of restrictive covenant. Employers add non-compete agreements to contracts when hiring new workers. They require that the worker agree to avoid direct competition with the company immediately after leaving their job. Non-compete agreements prevent workers from starting a competing business or from accepting a comparable role with a direct competitor in the same market.

There have been attempts to limit and outright prohibit non-compete agreements in recent years. Can employers operating in Nevada still have workers sign these agreements or enforce them after violations occur?

Nevada still recognizes non-compete agreements

While several other states, including California, have implemented bans on non-compete agreements, Nevada still allows for their inclusion in employment contracts. Companies typically have to ensure that the circumstances meet the standards set in Nevada state statutes.

For example, rules now prohibit companies from demanding that hourly workers sign non-compete agreements. This protects cooks and other professionals in unstable hourly work arrangements from becoming unable to monetize their work experience or skill.

However, non-compete agreements signed by workers paid on a salary basis are still theoretically enforceable in the right circumstances. The agreement typically needs to have appropriate restrictions included. The agreement should only last for a finite amount of time and should only apply to a specific geographic area. Non-compete agreements that are too broad or long-lasting may not hold up in court.

Provided that employers have proof that a former worker has violated a restrictive covenant, they can initiate business litigation to enforce the contract they previously signed with that employee. Tracking changes to federal and state statutes can help businesses optimize their protection when onboarding workers or dealing with a former employee who may have caused a company economic harm.

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