California Non-Compete Agreement Template
Reviewed by the Agiled editorial teamUpdated June 2026
Non-compete law is the most state-divergent area in employment contracting — four states ban these agreements outright, a dozen more impose salary floors or notice rules, and the rest apply judge-made reasonableness tests that differ in temperament. This page covers what California requires; the download is our standard non-compete template, to be scoped to California's rules below.
California non-compete rules at a glance
| Enforceability | Void and unenforceable for employees (B&P Code §16600) — regardless of where the contract was signed. |
|---|---|
| Protected workers / thresholds | All employees; sale-of-business and partnership-dissolution exceptions only |
| Required formalities | AB 1076 (2024) required employers to notify affected workers their non-competes are void; SB 699 creates a private right of action |
| Overbroad agreements | Void outright; attempting enforcement (even via out-of-state choice of law) is itself unlawful |
State laws change frequently and this summary is not legal advice. Verify current rules against the state statute or with a licensed attorney before relying on them.
How California handles non-compete agreements
California doesn't just refuse to enforce non-competes — since 2024 it penalizes employers for including them, and SB 699 reaches agreements signed out of state for workers now in California. Use confidentiality and trade-secret clauses instead. The practical drafting rule for California: void and unenforceable for employees (B&P Code §16600) — regardless of where the contract was signed.. Before using this template, confirm the current statute — non-compete law has changed in more than a dozen states since 2020, and the FTC's federal ban attempt keeps the area moving.
California non-compete agreement FAQs
Are non-compete agreements enforceable in California?
Void and unenforceable for employees (B&P Code §16600) — regardless of where the contract was signed. Coverage limits matter here: all employees; sale-of-business and partnership-dissolution exceptions only.
What happens to an overbroad non-compete in California?
Void outright; attempting enforcement (even via out-of-state choice of law) is itself unlawful Draft to the narrowest restriction that protects the actual business interest — the safety net (or lack of one) above is what you're betting on.
What formalities does a California non-compete require?
AB 1076 (2024) required employers to notify affected workers their non-competes are void; SB 699 creates a private right of action Procedural failures are now the most common way non-competes die — more common than substantive overbreadth in states with notice rules.
Does the FTC non-compete ban apply in California?
The FTC's 2024 rule banning most non-competes was set aside by a federal court before taking effect and remains in litigation, so it is not currently in force in California or any state. State law controls — which is why the state-specific rules above are the ones to draft around.
The full non-compete agreement guide
Clause-by-clause guidance, common mistakes, and the complete template text live on the main page: Non-Compete Agreement Template — full guide and download.