Colorado has one of the most employee-protective non-compete statutes in the nation. Under C.R.S. § 8-2-113, non-competes are only valid if you earn at least $123,750 per year (2024 figure, indexed annually). Even then, non-competes are strictly limited to protecting trade secrets. Non-solicitation agreements have their own income threshold of $74,250 per year. If you earn below these thresholds, your non-compete is unenforceable regardless of what the agreement says.
This statute, which took effect August 10, 2022, represents a major shift toward employee protection. Colorado recognizes that most workers should not be restricted from earning a living after leaving a job. Understanding whether you meet Colorado’s income threshold is the first step in determining whether your non-compete can be enforced.
Key Facts
| Factor | Details |
|---|---|
| Enforceability | Only if earning ≥$123,750/year; non-solicits ≥$74,250/year |
| Maximum Duration | No statutory cap, but must be reasonable |
| Income Threshold | $123,750/year (non-competes); $74,250/year (non-solicits); indexed annually |
| Blue-Pencil Available | Courts may modify unreasonable terms |
| Garden Leave Required | Must provide copy 14 days before start or signing |
What Makes a Non-Compete Enforceable in Colorado
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Income Threshold Met: You must earn at least $123,750 per year for a non-compete to be enforceable (2024 figure; threshold is indexed annually to Colorado’s average weekly wage).
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Trade Secret Protection Only: The non-compete must be designed to protect bona fide trade secrets. Generic customer lists or general business methods don’t qualify.
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Notice Requirement: The employer must provide you with a copy of the non-compete agreement at least 14 days before your start date or before you sign it. If the notice period is not met, the non-compete is unenforceable.
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Reasonable Duration: While no statutory maximum duration exists, the restriction must be reasonable in time. Courts scrutinize lengthy restrictions closely.
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Reasonable Geographic Scope: The restricted territory must be reasonable in relation to the employer’s legitimate business interest.
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Written Agreement: The non-compete must be in writing and signed.
Income Thresholds and Worker Exemptions
Colorado’s income threshold is the centerpiece of its non-compete protection. If you earn less than $123,750 per year (adjusted annually), your non-compete is unenforceable, and you can work for competitors without legal restriction.
If you earn $123,750 or more but less than $74,250 annually for non-solicitation purposes, you may be subject to a non-compete but not a non-solicitation. The thresholds are indexed annually to Colorado’s average weekly wage, so the exact threshold changes each year. You can find the current threshold on the Colorado Department of Labor and Employment website.
Additionally, employers must provide you with the non-compete agreement at least 14 days before your start date or before you sign it. Failure to provide this notice voids the non-compete.
What Happens If You Violate One
If you violate an enforceable non-compete in Colorado, your employer can seek an injunction to stop you from competing. Colorado courts grant preliminary injunctions if the employer shows likelihood of success and irreparable harm. An injunction can force you to stop your work immediately.
Your employer can also sue for monetary damages. However, Colorado law makes it clear that non-competes are disfavored restrictions, and courts are cautious about awarding large damages. The practical consequence is that an injunction can be devastating, forcing you to leave your job while litigation proceeds.
Real Situations in Colorado
A senior software engineer in Denver earning $150,000 per year signed a non-compete protecting trade secrets, with a 2-year duration and a 100-mile radius restriction centered on Denver. When he left to work for a competitor in Boulder, his former employer sought an injunction under C.R.S. § 8-2-113. Because he earned above the $123,750 threshold, was a senior employee with access to trade secrets, and the non-compete was limited to trade secret protection, the court enforced the non-compete as reasonable. He was barred from working for the competitor for 2 years.
A mid-level accountant in Denver earning $85,000 per year signed a non-compete restricting her from working for competing accounting firms within 50 miles for 2 years. When she left to join another accounting firm, her former employer sued. The court found her non-compete unenforceable because she earned $85,000, below Colorado’s $123,750 threshold. She was free to work for the competing firm without legal restriction.
A sales director in Colorado Springs earning $130,000 per year signed a non-compete but was not provided with a copy 14 days before his start date or before signing. When he left to work for a competitor, his former employer sought enforcement. The court found the non-compete unenforceable because the employer failed to satisfy C.R.S. § 8-2-113’s 14-day notice requirement. The sales director could work for competitors without restriction.
Common Mistakes Colorado Employees Make
Not checking whether they meet the income threshold. If you earn less than $123,750 per year, your non-compete is unenforceable. Don’t assume you’re bound; calculate your compensation and challenge the agreement if you’re below the threshold.
Forgetting that the threshold is indexed annually. Colorado’s income thresholds adjust every year to Colorado’s average weekly wage. If you’re near the threshold, check the current year’s amount before accepting a new job.
Accepting a non-compete without the 14-day notice. If your employer didn’t provide the non-compete 14 days before you started, the agreement is unenforceable. Document when you received the agreement and file it away for potential dispute.
What to Do If You Have a Non-Compete
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Calculate Your Annual Compensation: Determine your gross annual salary and benefits. If you earn below $123,750 (2024 threshold), your non-compete is unenforceable. Check Colorado’s current threshold on the Department of Labor and Employment website.
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Verify the 14-Day Notice Requirement: Confirm that you received the non-compete at least 14 days before your start date or before you signed it. If not, the agreement is unenforceable.
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Confirm Trade Secret Protection Language: Review the non-compete to ensure it’s limited to trade secrets. If it restricts you from competing generally or protecting customer lists alone, it likely fails Colorado’s “trade secret only” requirement.
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Consult a Colorado Employment Attorney: Before changing jobs, bring your non-compete, pay stub showing your annual compensation, and employment offer to an attorney. For $250–$400, you can get a clear assessment of enforceability.
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Negotiate with Your Former Employer: If your non-compete might be enforceable, attempt to negotiate a release or modification. Employers sometimes waive restrictions for certain roles or time periods.
Colorado Bar Association Lawyer Referral Service: www.cobar.org (or call 1-303-860-1115)
Related Guides
Disclaimer: This article provides general educational information about Colorado non-compete law under C.R.S. § 8-2-113. Income thresholds are indexed annually and change each year. This is not legal advice. If you are bound by a non-compete or considering accepting a position that might violate one, consult a licensed Colorado employment attorney immediately, bringing your pay stubs to confirm your compensation level. Laws change, and this article reflects the law as of March 2026.