{ "type": "practice-guide", "canonical": "https://openagreements.org/practice-guides/non-compete/us/colorado", "links": [ { "rel": "self", "href": "https://openagreements.org/practice-guides/non-compete/us/colorado.json", "type": "application/json" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/us/colorado", "type": "text/html" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/us/colorado/markdown", "type": "text/markdown" }, { "rel": "alternate", "href": "https://openagreements.org/practice-guides/non-compete/us/colorado/json", "type": "application/json" } ], "data": { "topic": "non-compete", "state": "colorado", "frontmatter": { "title": "Non-Competes in Colorado", "description": "Colorado makes most employee non-competes and customer non-solicits void by statute, allowing them only for highly compensated workers protecting trade secrets, and closing that allowance entirely for covenants restricting the practice of medicine, advanced practice registered nursing, or dentistry.", "state": "Colorado", "lastReviewed": "2026-06-03", "license": "CC BY 4.0", "authors": [ "steven-obiajulu" ], "summary": { "enforceability": "payThreshold", "bottomLine": "Colorado voids most employee non-competes and customer non-solicits, allowing a non-compete only against a highly compensated worker ($130,014 in 2026) to protect trade secrets — and no compensation level rescues a covenant restricting the practice of medicine, advanced practice registered nursing, or dentistry.", "keyLaw": "C.R.S. § 8-2-113", "exceptions": "Health-care provider ban (eff. Aug 6, 2025, SB 25-083); sale-of-business; reasonable confidentiality; capped training-repayment", "banEffectiveDate": "Aug 10, 2022 (covenants entered or renewed on/after; HB 22-1317)", "courtNarrowing": "unsettled", "appliesToContractors": "unclear", "extendedForBreach": "Open question — threshold must be met at enforcement, cutting against extension", "maxLength": "No general duration limit", "noticeRequirement": "Separate notice required before signing", "incomeThreshold": "$130,014 (2026)", "saleOfBusiness": "Allowed for an owner of an interest in the business; minority-owner duration cap", "customerNonSolicit": "$78,008.40 threshold (2026); trade-secret limit", "employeeNonSolicit": "Unsettled; statute silent" }, "about": [ "Colorado non-compete agreements", "Colorado restrictive covenants", "C.R.S. 8-2-113 covenant not to compete", "Colorado highly compensated worker non-compete threshold", "Colorado non-compete 14-day notice requirement", "Colorado physician and health-care provider non-compete ban", "Colorado SB 25-083 minority owner sale-of-business non-compete", "Colorado training repayment agreement provisions TRAPs", "Colorado non-compete $5,000 penalty" ], "translations": [ { "language": "中文", "status": "planned" }, { "language": "Español", "status": "planned" }, { "language": "Português", "status": "planned" }, { "language": "Deutsch", "status": "planned" } ], "relatedForm": { "slug": "openagreements-restrictive-covenant-colorado" } }, "questions": [ { "slug": "employee-non-compete-enforceability", "label": "Are employee non-competes enforceable?", "heading": "Are employee non-compete agreements enforceable in Colorado?", "answerText": "Usually no. For covenants entered into or renewed on or after August 10, 2022, Colorado law makes any covenant not to compete that restricts a person's right to earn compensation for labor void unless it fits a narrow statutory exception.", "sources": [ { "id": "crs-void-rule", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(2)(a).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(2)(a) supports Colorado's baseline rule that a covenant not to compete restricting the right to earn compensation for labor is void unless an exception applies.", "verbatimQuote": "Except as provided in subsections (2)(b), (2)(d), and (3) of this section, a covenant not to compete that restricts the right of an individual to receive compensation for performance of labor is void.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-void-rule" }, { "id": "crs-hcw-exception", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(2)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(2)(b) supports the narrow exception for highly compensated workers where the covenant protects trade secrets and is no broader than reasonably necessary, and its exclusion of any covenant restricting the practice of medicine, advanced practice registered nursing, or dentistry.", "verbatimQuote": "Except for a covenant not to compete that restricts the practice of medicine, the practice of advanced practice registered nursing, or the practice of dentistry in this state, this subsection (2) does not apply to a covenant not to compete governing an individual who, at the time the covenant not to compete is entered into and at the time it is enforced, earns an amount of annualized cash compensation equivalent to or greater than the threshold amount for highly compensated workers, if the covenant not to compete is for the protection of trade secrets and is no broader than is reasonably necessary to protect the employer's legitimate interest in protecting trade secrets.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-hcw-exception" }, { "id": "crs-training-exception", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(3)(a).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(3) supports the list of covenants that are not prohibited, including capped training-repayment provisions, confidentiality provisions, and sale-of-business covenants.", "verbatimQuote": "A provision providing for an employer's recovery of the expense of educating and training a worker where the training is distinct from normal, on-the-job training and satisfies any other requirements established by the attorney general, by rule, regarding the transferability of the training or credentialing that is available to the employee as a result of the training.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-training-exception" }, { "id": "phoenix-employer-burden", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Phoenix Capital, Inc. v. Dowell", "citation": "Phoenix Capital, Inc. v. Dowell, 176 P.3d 835 (Colo. App. 2007).", "url": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/", "deepLink": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/#:~:text=In%20the%20preliminary%20injunction%20context%2C,one%20of%20those%20narrow%20exceptions.", "proposition": "Phoenix supports the rule that the employer seeking to enforce a covenant not to compete bears the burden of showing it falls within a statutory exception.", "verbatimQuote": "In the preliminary injunction context, the employer has the burden to establish that the covenant not to compete falls within one of those narrow exceptions.", "date": "2007-07-26", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-phoenix-employer-burden" } ] }, { "slug": "highly-compensated-threshold", "label": "When is a non-compete allowed?", "heading": "When can a Colorado employer use a non-compete or customer non-solicit agreement?", "answerText": "Only for a highly compensated worker, to protect trade secrets. A non-compete is permitted only against a worker whose annualized cash compensation meets the highly compensated worker threshold — $130,014 in 2026 — and a customer non-solicit needs at least 60% of that threshold, $78,008.40 in 2026.", "sources": [ { "id": "crs-hcw-threshold", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(2)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(2)(b) supports the highly compensated worker requirement, measured both at signing and at enforcement, with a trade-secret and tailoring requirement — and its exclusion of any covenant restricting the practice of medicine, advanced practice registered nursing, or dentistry, which no compensation level satisfies.", "verbatimQuote": "Except for a covenant not to compete that restricts the practice of medicine, the practice of advanced practice registered nursing, or the practice of dentistry in this state, this subsection (2) does not apply to a covenant not to compete governing an individual who, at the time the covenant not to compete is entered into and at the time it is enforced, earns an amount of annualized cash compensation equivalent to or greater than the threshold amount for highly compensated workers, if the covenant not to compete is for the protection of trade secrets and is no broader than is reasonably necessary to protect the employer's legitimate interest in protecting trade secrets.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-hcw-threshold" }, { "id": "crs-customer-nonsolicit-threshold", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(2)(d).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(2)(d) supports the separate customer non-solicit threshold of sixty percent of the highly compensated worker amount, and its exclusion of any covenant restricting the practice of medicine, advanced practice registered nursing, or dentistry.", "verbatimQuote": "Except for a covenant not to compete that restricts the practice of medicine, the practice of advanced practice registered nursing, or the practice of dentistry in this state, this subsection (2) does not apply to a covenant not to solicit customers governing an individual who, at the time the covenant is entered into and at the time it is enforced, earns an amount of annualized cash compensation equivalent to or greater than sixty percent of the threshold amount for highly compensated workers, if the nonsolicitation covenant is no broader than reasonably necessary to protect the employer's legitimate interest in protecting trade secrets.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-customer-nonsolicit-threshold" }, { "id": "ebg-2026-thresholds", "authorityType": "law-firm-commentary", "tier": "lawyer-judgment-backed", "title": "Raising the Cost of Noncompetes: 2026 State Noncompete Salary Threshold Changes", "citation": "Epstein Becker Green, Raising the Cost of Noncompetes: 2026 State Noncompete Salary Threshold Changes (Dec. 10, 2025).", "url": "https://www.tradesecretsandemployeemobility.com/raising-the-cost-of-noncompetes-2026-state-noncompete-salary-threshold-changes", "proposition": "Epstein Becker Green's threshold tracker supports the derived 2026 customer-non-solicit figure of $78,008.40 (60% of the highly compensated worker threshold), which the PAY CALC Order itself does not state.", "verbatimQuote": "Effective January 1, 2026, the threshold amount for highly compensated workers is $130,014. Furthermore, an employer cannot subject an employee to a non-solicitation provision where an employee earns less than 60% of the threshold amount for highly compensated workers. Colorado’s 2026 non-solicitation salary threshold is $78,008.40.", "date": "2025-12-10", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-ebg-2026-thresholds" }, { "id": "paycalc-hcw-threshold", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "Temporary 2026 PAY CALC Order, 7 CCR 1103-14", "citation": "Temporary 2026 PAY CALC Order, 7 CCR 1103-14, Rule 1.2.1(G) (effective January 2026).", "url": "https://www.sos.state.co.us/CCR/GenerateRulePdf.do?ruleVersionId=12310&fileName=7+CCR+1103-14", "proposition": "The temporary 2026 PAY CALC Order supports the official 2026 highly compensated employee threshold of $130,014 for its January 1–31 effective period.", "verbatimQuote": "Highly compensated employees (R. 2.2.11) $130,014 annually, and the EAP salary (row E) weekly", "date": "2026-01-01", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-paycalc-hcw-threshold" }, { "id": "crs-threshold-execution-year", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(2)(c)(II).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(2)(c)(II) supports the rule that the controlling threshold is the greater of the August 10, 2022 amount or the amount in effect when the covenant is executed.", "verbatimQuote": "\"Threshold amount for highly compensated workers\" means the greater of the threshold amount for highly compensated workers as determined by the division of labor standards and statistics in the department of labor and employment: (A) As of August 10, 2022; or (B) At the time the covenant not to compete is executed by the parties.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-threshold-execution-year" }, { "id": "threshold-health-care-exclusion", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "S.B. 25-083 (Limitations on Restrictive Employment Agreements)", "citation": "S.B. 25-083, 75th Gen. Assemb., Reg. Sess. (Colo. 2025) (amending C.R.S. § 8-2-113(2)(d)).", "url": "https://leg.colorado.gov/bills/sb25-083", "proposition": "SB 25-083 supports the point that the same carve-out applies to the customer-non-solicit exception, so a covenant restricting the practice of medicine, advanced practice registered nursing, or dentistry is void regardless of the compensation threshold.", "verbatimQuote": "EXCEPT FOR A COVENANT NOT TO COMPETE THAT RESTRICTS THE PRACTICE OF MEDICINE, THE PRACTICE OF ADVANCED PRACTICE REGISTERED NURSING, OR THE PRACTICE OF DENTISTRY IN THIS STATE, this subsection (2) does not apply to a covenant not to solicit customers", "date": "2025-06-03", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-threshold-health-care-exclusion" } ] }, { "slug": "notice-requirements", "label": "What notice must employers give?", "heading": "What notice must a Colorado employer give before a non-compete?", "answerText": "A separate, signed written notice, on a strict timeline. Even a covenant that fits an exception is void unless the employer gives the worker a separate written notice — before a prospective worker accepts the job, or at least fourteen days before the covenant or new consideration takes effect for a current worker.", "sources": [ { "id": "crs-notice-timing", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(4)(a)(II).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(4)(a) supports the fourteen-day advance notice requirement for current workers, measured against the covenant's or new consideration's effective date.", "verbatimQuote": "A current worker at least fourteen days before the earlier of: (A) The effective date of the covenant; or (B) The effective date of any additional compensation or change in the terms or conditions of employment that provides consideration for the covenant.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-notice-timing" }, { "id": "crs-notice-separate-document", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(4)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(4)(b) supports the requirement that notice be a separate, clear and conspicuous document signed by the worker.", "verbatimQuote": "An employer shall provide the notice required in subsection (4)(a) of this section in a separate document from any other covenants between the worker and employer and in clear and conspicuous terms in the language in which the worker and employer communicate about the worker's performance. The notice must be signed by the worker.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-notice-separate-document" }, { "id": "crs-notice-content", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(4)(d).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(4)(d) supplies the agreement-copy, warning, and exact-section-pointer elements that satisfy the notice requirement.", "verbatimQuote": "An employer satisfies the notice requirement of this subsection (4) when the notice: (I) Is provided with a copy of the agreement containing the covenant not to compete; (II) Identifies the agreement by name and states that the agreement contains a covenant not to compete that could restrict the workers' options for subsequent employment following their separation from the employer; and (III) Directs the worker to the specific sections or paragraphs of the agreement that contain the covenant not to compete.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-notice-content" } ] }, { "slug": "health-care-providers", "label": "What about physicians and health-care providers?", "heading": "Are non-competes enforceable against Colorado physicians and other health-care providers?", "answerText": "Not where the covenant restricts the practice of medicine, advanced practice registered nursing, or dentistry, for agreements entered into or renewed on or after August 6, 2025. Senate Bill 25-083 closed the compensation exceptions for those three practices, so a covenant restricting them is void however much the worker earns.", "sources": [ { "id": "sb25083-health-care-carveout", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "S.B. 25-083 (Limitations on Restrictive Employment Agreements)", "citation": "S.B. 25-083, 75th Gen. Assemb., Reg. Sess. (Colo. 2025) (amending C.R.S. § 8-2-113(2)(b)).", "url": "https://leg.colorado.gov/bills/sb25-083", "proposition": "SB 25-083 supports the rule that the highly compensated worker exception does not apply to covenants restricting the practice of medicine, advanced practice registered nursing, or dentistry.", "verbatimQuote": "EXCEPT FOR A COVENANT NOT TO COMPETE THAT RESTRICTS THE PRACTICE OF MEDICINE, THE PRACTICE OF ADVANCED PRACTICE REGISTERED NURSING, OR THE PRACTICE OF DENTISTRY IN THIS STATE, this subsection (2) does not apply to a covenant not to compete", "date": "2025-06-03", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-sb25083-health-care-carveout" }, { "id": "sb25083-health-care-provider-definition", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "S.B. 25-083 (Limitations on Restrictive Employment Agreements)", "citation": "S.B. 25-083, 75th Gen. Assemb., Reg. Sess. (Colo. 2025) (adding C.R.S. § 8-2-113(2)(c)(I.3)).", "url": "https://leg.colorado.gov/bills/sb25-083", "proposition": "SB 25-083 supports the statutory definition of health-care provider — a physician, an advanced practice registered nurse, a certified midwife, or a dentist — which is the class the patient-communication deeming rule protects, and which is broader than the three practices the compensation exceptions are closed for.", "verbatimQuote": "\"HEALTH-CARE PROVIDER\" MEANS AN INDIVIDUAL LICENSED TO ENGAGE IN THE PRACTICE OF MEDICINE, REGISTERED TO ENGAGE IN THE PRACTICE OF ADVANCED PRACTICE REGISTERED NURSING, LICENSED TO PRACTICE AS A CERTIFIED MIDWIFE, OR LICENSED TO ENGAGE IN THE PRACTICE OF DENTISTRY.", "date": "2025-06-03", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-sb25083-health-care-provider-definition" }, { "id": "sb25083-patient-communication", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "S.B. 25-083 (Limitations on Restrictive Employment Agreements)", "citation": "S.B. 25-083, 75th Gen. Assemb., Reg. Sess. (Colo. 2025) (adding C.R.S. § 8-2-113(5.5)).", "url": "https://leg.colorado.gov/bills/sb25-083", "proposition": "SB 25-083 supports the patient-communication protections that void a covenant restricting a departing provider from disclosing continuing practice, contact information, or patient choice.", "verbatimQuote": "(a) THE HEALTH-CARE PROVIDER'S CONTINUING PRACTICE OF MEDICINE; (b) THE HEALTH-CARE PROVIDER'S NEW PROFESSIONAL CONTACT INFORMATION; OR (c) THE PATIENT'S RIGHT TO CHOOSE A HEALTH-CARE PROVIDER.", "date": "2025-06-03", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-sb25083-patient-communication" } ] }, { "slug": "sale-of-business", "label": "What about sale-of-business covenants?", "heading": "Are sale-of-business non-competes enforceable in Colorado, including for minority owners?", "answerText": "Yes for an owner, with a cap for minority owners. Subsection (2) does not prohibit a covenant not to compete related to the purchase and sale of a business, an ownership share in it, or substantially all of its assets, but only where the covenant restricts competition by an owner of an interest in the business — and for an owner who holds a minority share received as equity compensation, SB 25-083 caps the non-compete's duration by a formula.", "sources": [ { "id": "crs-sale-of-business", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(3)(c).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(3)(c) supports the sale-of-business covenant that subsection (2) does not prohibit, which as amended reaches only a covenant restricting competition by an owner of an interest in the business.", "verbatimQuote": "For an individual who owns a minority ownership share of the business and who received their ownership share in the business as equity compensation or otherwise in connection with services rendered, the duration in years of a covenant not to compete described in this subsection (3)(c) must not exceed a number calculated by the total consideration received by the individual from the sale divided by the average annualized cash compensation received by the individual from the business, including income received on account of their ownership interest during the preceding two years or during the period of time that the individual was affiliated with the business, whichever period of time is shorter.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-sale-of-business" }, { "id": "sb25083-minority-owner-formula", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "S.B. 25-083 (Limitations on Restrictive Employment Agreements)", "citation": "S.B. 25-083, 75th Gen. Assemb., Reg. Sess. (Colo. 2025) (amending C.R.S. § 8-2-113(3)(c)).", "url": "https://leg.colorado.gov/bills/sb25-083", "proposition": "SB 25-083 supports the duration cap on a minority owner's sale-of-business non-compete, calculated from total sale consideration divided by average annualized cash compensation.", "verbatimQuote": "THE DURATION IN YEARS OF A COVENANT NOT TO COMPETE DESCRIBED IN THIS SUBSECTION (3)(c) MUST NOT EXCEED A NUMBER CALCULATED BY THE TOTAL CONSIDERATION RECEIVED BY THE INDIVIDUAL FROM THE SALE DIVIDED BY THE AVERAGE ANNUALIZED CASH COMPENSATION RECEIVED BY THE INDIVIDUAL FROM THE BUSINESS, INCLUDING INCOME RECEIVED ON ACCOUNT OF THEIR OWNERSHIP INTEREST DURING THE PRECEDING TWO YEARS OR DURING THE PERIOD OF TIME THAT THE INDIVIDUAL WAS AFFILIATED WITH THE BUSINESS, WHICHEVER PERIOD OF TIME IS SHORTER.", "date": "2025-06-03", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-sb25083-minority-owner-formula" } ] }, { "slug": "training-repayment", "label": "Can employers recover training costs?", "heading": "Can a Colorado employer recover training costs through a repayment agreement (TRAP)?", "answerText": "Only within strict limits. A training-repayment provision is permitted only when the training is distinct from normal on-the-job training and meets the attorney general's rules on transferability of the training or credential, and the recoverable amount is capped at reasonable costs that decrease over two years.", "sources": [ { "id": "crs-traps", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(3)(a).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(3)(a) supports the limits on training-repayment provisions: distinct training, attorney-general transferability rules, reasonable costs, and a two-year decreasing recovery.", "verbatimQuote": "A provision providing for an employer's recovery of the expense of educating and training a worker where the training is distinct from normal, on-the-job training and satisfies any other requirements established by the attorney general, by rule, regarding the transferability of the training or credentialing that is available to the employee as a result of the training. The employer's recovery is limited to the reasonable costs of the training and decreases over the course of the two years subsequent to the training", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-traps" }, { "id": "crs-traps-treble", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(8)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(8)(b) supports the attorney general's authority to recover treble damages for an unlawful training-cost recovery.", "verbatimQuote": "The attorney general may recover three times the amount of any recovery or attempted recovery by an employer in violation of subsection (3)(a) of this section.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-traps-treble" } ] }, { "slug": "confidentiality-covenants", "label": "Are confidentiality covenants still allowed?", "heading": "Are confidentiality and nondisclosure covenants still allowed in Colorado?", "answerText": "Yes. A reasonable confidentiality provision relevant to the employer's business is expressly permitted and is not treated as a void non-compete.", "sources": [ { "id": "crs-confidentiality", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(3)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(3)(b) supports the carve-out for a reasonable confidentiality provision or trade secret provision that does not bar disclosure of general skills, publicly ascertainable information, or legally protected conduct.", "verbatimQuote": "A reasonable confidentiality provision or trade secret provision relevant to the employer's business that does not prohibit disclosure of information that arises from the worker's general training, knowledge, skill, or experience, whether gained on the job or otherwise, information that is readily ascertainable to the public, or information that a worker otherwise has a right to disclose as legally protected conduct", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-confidentiality" } ] }, { "slug": "penalties", "label": "What are the penalties?", "heading": "What are the penalties for presenting or enforcing a void Colorado non-compete?", "answerText": "Significant. An employer that enters into, presents, or tries to enforce a void covenant is liable for actual damages plus a penalty of $5,000 per worker or prospective worker harmed, and faces enforcement by both private plaintiffs and the attorney general.", "sources": [ { "id": "crs-prohibited-conduct", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(8)(a).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(8)(a) supports the rule that entering into, presenting, or attempting to enforce a void covenant is itself prohibited conduct.", "verbatimQuote": "An employer shall not enter into, present to a worker or prospective worker as a term of employment, or attempt to enforce any covenant that is void under this section.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-prohibited-conduct" }, { "id": "crs-penalty", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(8)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(8)(b) supports the $5,000-per-worker penalty plus actual damages, and the private and attorney-general enforcement scheme.", "verbatimQuote": "An employer that violates subsection (8)(a) of this section is liable for actual damages and a penalty of five thousand dollars per worker or prospective worker harmed by the conduct.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-penalty" }, { "id": "crs-misdemeanor", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(1.5)(a).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(1.5) supports the separate class 2 misdemeanor for using force, threats, or intimidation to prevent lawful work.", "verbatimQuote": "It is unlawful to use force, threats, or other means of intimidation to prevent any person from engaging in any lawful occupation at any place the person sees fit.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-misdemeanor" } ] }, { "slug": "choice-of-law", "label": "Can another state's law govern?", "heading": "Can another state's law or court govern a Colorado worker's non-compete?", "answerText": "No, for a Colorado-based worker. If the worker primarily resided and worked in Colorado at termination, Colorado law governs the covenant's enforceability and the worker cannot be required to litigate enforceability outside Colorado, regardless of any contrary contract clause.", "sources": [ { "id": "crs-choice-of-law", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(6).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(6) supports the rule that Colorado law governs enforceability for a worker who primarily resided and worked in Colorado at termination, notwithstanding a contrary clause.", "verbatimQuote": "Notwithstanding any contractual provision to the contrary, Colorado law governs the enforceability of a covenant not to compete for a worker who, at the time of termination of employment, primarily resided and worked in Colorado.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-choice-of-law" }, { "id": "crs-venue", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(6).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(6) supports the rule that a Colorado-based worker cannot be required to adjudicate enforceability outside Colorado.", "verbatimQuote": "A covenant not to compete that applies to a worker who, at the time of termination of employment, primarily resided or worked in Colorado may not require the worker to adjudicate the enforceability of the covenant outside of Colorado.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-venue" } ] }, { "slug": "continued-employment-consideration", "label": "Does continued employment count?", "heading": "Is continued at-will employment enough consideration for a Colorado non-compete?", "answerText": "Yes. Under Lucht's Concrete Pumping, Inc. v. Horner, an employer that forbears from terminating an existing at-will employee gives adequate consideration for a non-compete signed after employment begins.", "sources": [ { "id": "luchts-continued-employment", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Lucht's Concrete Pumping, Inc. v. Horner", "citation": "Lucht's Concrete Pumping, Inc. v. Horner, 255 P.3d 1058 (Colo. 2011).", "url": "https://www.courtlistener.com/opinion/2454091/luchts-concrete-pumping-inc-v-horner/", "deepLink": "https://www.courtlistener.com/opinion/2454091/luchts-concrete-pumping-inc-v-horner/#:~:text=We%20hold%20that%20an%20employer,consideration%20for%20a%20noncompetition%20agreement", "proposition": "Lucht's supports the rule that an employer's forbearance from terminating an existing at-will employee is adequate consideration for a non-compete.", "verbatimQuote": "We hold that an employer that forbears from terminating an existing at-will employee forbears from exercising a legal right, and that therefore such forbearance constitutes adequate consideration for a noncompetition agreement", "date": "2011-05-31", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-luchts-continued-employment" }, { "id": "crs-consideration-notice", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(4)(a)(II).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(4)(a) supports the rule that for a current worker the covenant or its new consideration cannot take effect until fourteen days after the required notice.", "verbatimQuote": "A current worker at least fourteen days before the earlier of: (A) The effective date of the covenant; or (B) The effective date of any additional compensation or change in the terms or conditions of employment that provides consideration for the covenant.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-consideration-notice" } ] }, { "slug": "court-narrowing", "label": "Will courts narrow an overbroad covenant?", "heading": "Will a Colorado court blue-pencil or narrow an overbroad non-compete?", "answerText": "Do not count on it. Colorado courts have discretion to blue-pencil an overbroad covenant but are not required to, and parties cannot contractually force a court to rewrite one.", "sources": [ { "id": "twentythree-ltd-discretion", "authorityType": "case-law", "tier": "primary-source-backed", "title": "23 LTD v. Herman", "citation": "23 LTD v. Herman, 2019 COA 113.", "url": "https://www.courtlistener.com/opinion/4644233/23-ltd-v-herman/", "deepLink": "https://www.courtlistener.com/opinion/4644233/23-ltd-v-herman/#:~:text=they%20have%20made%20clear%20that,at%20least%20to%20some%20extent.", "proposition": "23 LTD supports the rule that Colorado trial courts have discretion — but no obligation — to blue pencil an unenforceable covenant.", "verbatimQuote": "they have made clear that trial courts have the discretion to blue pencil unenforceable noncompete provisions, at least to some extent.", "date": "2019-07-25", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-twentythree-ltd-discretion" }, { "id": "twentythree-ltd-no-rewrite", "authorityType": "case-law", "tier": "primary-source-backed", "title": "23 LTD v. Herman", "citation": "23 LTD v. Herman, 2019 COA 113.", "url": "https://www.courtlistener.com/opinion/4644233/23-ltd-v-herman/", "deepLink": "https://www.courtlistener.com/opinion/4644233/23-ltd-v-herman/#:~:text=It%20is%20not%20the%20function,public%20policy%20of%20the%20state.", "proposition": "23 LTD supports the rule that a court will not rewrite a contract to enable enforcement of terms that violate Colorado public policy.", "verbatimQuote": "It is not the function of a court to write or rewrite contracts for parties to enable enforcement of a contract that, as written, violates the public policy of the state.", "date": "2019-07-25", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-twentythree-ltd-no-rewrite" }, { "id": "twentythree-ltd-no-contractual-compulsion", "authorityType": "case-law", "tier": "primary-source-backed", "title": "23 LTD v. Herman", "citation": "23 LTD v. Herman, 2019 COA 113.", "url": "https://www.courtlistener.com/opinion/4644233/23-ltd-v-herman/", "deepLink": "https://www.courtlistener.com/opinion/4644233/23-ltd-v-herman/#:~:text=Thus%2C%20parties%20to%20an%20employment,that%20it%20determines%20are%20unreasonable.", "proposition": "23 LTD supports the rule that parties cannot contractually obligate a court to blue pencil unreasonable covenants.", "verbatimQuote": "Thus, parties to an employment or noncompete agreement cannot contractually obligate a court to blue pencil noncompete provisions that it determines are unreasonable.", "date": "2019-07-25", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-twentythree-ltd-no-contractual-compulsion" }, { "id": "crs-present-void-narrowing", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(8)(a).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(8)(a) supports the drafting risk that presenting a void covenant is itself prohibited, so an employer cannot rely on judicial narrowing.", "verbatimQuote": "An employer shall not enter into, present to a worker or prospective worker as a term of employment, or attempt to enforce any covenant that is void under this section.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-present-void-narrowing" } ] }, { "slug": "employee-nonsolicitation", "label": "Are employee no-hire clauses enforceable?", "heading": "Are employee non-solicitation (no-hire) clauses enforceable in Colorado?", "answerText": "Unsettled, but better supported than customer non-solicits. The statute pegs customer non-solicits to the 60% threshold but is silent on agreements not to solicit a former employer's employees, and Phoenix Capital, Inc. v. Dowell treated an employee non-solicit as a lesser restraint that can survive even when the non-compete is invalid.", "sources": [ { "id": "phoenix-employee-nonsolicit", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Phoenix Capital, Inc. v. Dowell", "citation": "Phoenix Capital, Inc. v. Dowell, 176 P.3d 835 (Colo. App. 2007).", "url": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/", "deepLink": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/#:~:text=Where%20a%20nonsolicitation%20provision%20is,of%20an%20accompanying%20noncompetition%20provision.", "proposition": "Phoenix supports the rule that an employee non-solicitation provision limited to active solicitation can be enforceable even when an accompanying non-compete is invalid.", "verbatimQuote": "Where a nonsolicitation provision is limited to prohibiting only initiating contacts or \"active\" solicitation of the employer's employees, it is enforceable, despite the invalidity of an accompanying noncompetition provision.", "date": "2007-07-26", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-phoenix-employee-nonsolicit" }, { "id": "phoenix-livelihood-distinction", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Phoenix Capital, Inc. v. Dowell", "citation": "Phoenix Capital, Inc. v. Dowell, 176 P.3d 835 (Colo. App. 2007).", "url": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/", "deepLink": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/#:~:text=In%20contrast%2C%20an%20agreement%20not,ability%20to%20make%20a%20living.", "proposition": "Phoenix supports the distinction that an agreement not to solicit employees does not impair the former employee's ability to make a living, unlike a customer non-solicit.", "verbatimQuote": "In contrast, an agreement not to solicit employees would not impair the former employee's ability to make a living.", "date": "2007-07-26", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-phoenix-livelihood-distinction" }, { "id": "phoenix-conclusion-distinction", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Phoenix Capital, Inc. v. Dowell", "citation": "Phoenix Capital, Inc. v. Dowell, 176 P.3d 835 (Colo. App. 2007).", "url": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/", "deepLink": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/#:~:text=We%20conclude%20that%2C%20although%20the,not%20to%20solicit%20Phoenix's%20customers.", "proposition": "Phoenix supports the holding distinguishing an enforceable employee non-solicit from an invalid customer non-solicit when the non-compete is void.", "verbatimQuote": "We conclude that, although the invalidity of the noncompetition provision did not render invalid Dowell's agreement not to solicit Phoenix's employees, it rendered invalid Dowell's agreement not to solicit Phoenix's customers.", "date": "2007-07-26", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-phoenix-conclusion-distinction" }, { "id": "crs-customer-nonsolicit-silence", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(2)(d).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(2)(d) supports the point that the statute addresses customer non-solicits at the 60% threshold and does not separately address employee non-solicits.", "verbatimQuote": "Except for a covenant not to compete that restricts the practice of medicine, the practice of advanced practice registered nursing, or the practice of dentistry in this state, this subsection (2) does not apply to a covenant not to solicit customers governing an individual who, at the time the covenant is entered into and at the time it is enforced, earns an amount of annualized cash compensation equivalent to or greater than sixty percent of the threshold amount for highly compensated workers, if the nonsolicitation covenant is no broader than reasonably necessary to protect the employer's legitimate interest in protecting trade secrets.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-customer-nonsolicit-silence" } ] }, { "slug": "extended-for-breach", "label": "Does a non-compete toll during breach?", "heading": "Does a Colorado non-compete toll or extend during breach or litigation?", "answerText": "This is an open Colorado question, and the statute's structure cuts against automatic extension. No Colorado statute or appellate decision endorses automatically tolling or extending the restricted period during a breach or while litigation is pending.", "sources": [ { "id": "phoenix-no-extension", "authorityType": "case-law", "tier": "primary-source-backed", "title": "Phoenix Capital, Inc. v. Dowell", "citation": "Phoenix Capital, Inc. v. Dowell, 176 P.3d 835 (Colo. App. 2007).", "url": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/", "deepLink": "https://www.courtlistener.com/opinion/2633761/phoenix-capital-inc-v-dowell/#:~:text=Consequently%2C%20we%20discern%20no%20error,specified%20in%20the%20parties'%20agreement.", "proposition": "Phoenix supports the caution that a Colorado court may decline to extend a restraint beyond the term specified in the agreement.", "verbatimQuote": "Consequently, we discern no error in the trial court's refusing to extend the terms of the preliminary injunction beyond the one-year term specified in the parties' agreement.", "date": "2007-07-26", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-phoenix-no-extension" }, { "id": "crs-enforced-time", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(2)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(2)(b) supports the point that the worker must meet the compensation threshold at the time the covenant is enforced, which constrains any later extension.", "verbatimQuote": "Except for a covenant not to compete that restricts the practice of medicine, the practice of advanced practice registered nursing, or the practice of dentistry in this state, this subsection (2) does not apply to a covenant not to compete governing an individual who, at the time the covenant not to compete is entered into and at the time it is enforced, earns an amount of annualized cash compensation equivalent to or greater than the threshold amount for highly compensated workers, if the covenant not to compete is for the protection of trade secrets and is no broader than is reasonably necessary to protect the employer's legitimate interest in protecting trade secrets.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-crs-enforced-time" } ] }, { "slug": "recent-developments", "label": "What recent changes should employers watch?", "heading": "What are the key recent developments in Colorado non-compete law?", "answerText": "Colorado has tightened its non-compete law in four steps since 2022, moving from a title-based exception regime to objective wage thresholds, then to training-repayment and health-care restrictions.", "sources": [ { "id": "dev-misdemeanor", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(1.5)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(1.5) supports the class 2 misdemeanor for using force, threats, or intimidation to prevent lawful work, effective March 1, 2022.", "verbatimQuote": "A person who violates this subsection (1.5) commits a class 2 misdemeanor, as defined in section 18-1.3-501.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-dev-misdemeanor" }, { "id": "dev-hb22-1317", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(8)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(8)(b) reflects the $5,000-per-worker penalty added by House Bill 22-1317, effective August 10, 2022.", "verbatimQuote": "An employer that violates subsection (8)(a) of this section is liable for actual damages and a penalty of five thousand dollars per worker or prospective worker harmed by the conduct.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-dev-hb22-1317" }, { "id": "dev-hb24-1324", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "C.R.S. § 8-2-113", "citation": "C.R.S. § 8-2-113(8)(b).", "url": "https://olls.info/crs/crs2025-title-08.pdf", "proposition": "Section 8-2-113(8)(b) reflects the treble-damages authority over training-repayment violations added by House Bill 24-1324, effective August 7, 2024.", "verbatimQuote": "The attorney general may recover three times the amount of any recovery or attempted recovery by an employer in violation of subsection (3)(a) of this section.", "date": "2025-09-16", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-dev-hb24-1324" }, { "id": "dev-sb25-083", "authorityType": "primary-law", "tier": "primary-source-backed", "title": "S.B. 25-083 (Limitations on Restrictive Employment Agreements)", "citation": "S.B. 25-083, 75th Gen. Assemb., Reg. Sess. (Colo. 2025) (amending C.R.S. § 8-2-113(2)(b)).", "url": "https://leg.colorado.gov/bills/sb25-083", "proposition": "SB 25-083 supports the 2025 amendment removing the highly compensated worker exception for covenants restricting the practice of medicine, advanced practice registered nursing, or dentistry — so the subsection (2)(a) void rule applies to those providers.", "verbatimQuote": "EXCEPT FOR A COVENANT NOT TO COMPETE THAT RESTRICTS THE PRACTICE OF MEDICINE, THE PRACTICE OF ADVANCED PRACTICE REGISTERED NURSING, OR THE PRACTICE OF DENTISTRY IN THIS STATE, this subsection (2) does not apply to a covenant not to compete", "date": "2025-06-03", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-dev-sb25-083" }, { "id": "ebg-recent-thresholds", "authorityType": "law-firm-commentary", "tier": "lawyer-judgment-backed", "title": "Raising the Cost of Noncompetes: 2026 State Noncompete Salary Threshold Changes", "citation": "Epstein Becker Green, Raising the Cost of Noncompetes: 2026 State Noncompete Salary Threshold Changes (Dec. 10, 2025).", "url": "https://www.tradesecretsandemployeemobility.com/raising-the-cost-of-noncompetes-2026-state-noncompete-salary-threshold-changes", "proposition": "Epstein Becker Green's tracker supports the point that the Colorado threshold is updated annually, reaching $130,014 for 2026.", "verbatimQuote": "Effective January 1, 2026, the threshold amount for highly compensated workers is $130,014.", "date": "2025-12-10", "anchor": "https://openagreements.org/practice-guides/non-compete/us/colorado#src-ebg-recent-thresholds" } ] } ] } }