§ 1. Governing Statutory & Common Law Authority
The enforceability of non-competition agreements in Nevada is governed by NRS § 613.195 (amended 2021). Non-competes enforceable with limitations. Cannot restrict a former employee paid solely on hourly wage (excluding tips/gratuities). Court must revise overbroad agreements.
Recent legislative developments: 2021 amendments added hourly worker protection and court-revision requirement.
§ 2. Compensation Threshold Requirements
Nevada does not impose a minimum salary threshold for non-compete enforceability. This means non-competes may be enforced against employees at any income level, including hourly and part-time workers.
§ 3. Temporal Limitations on Post-Employment Restrictions
Nevada does not codify a maximum duration. Must be reasonable; courts can revise. In practice, 1-2 years is generally considered the outer limit of reasonableness, though outcomes vary significantly based on the employee's role and access to trade secrets.
§ 4. Judicial Modification (Reformation Doctrine)
Nevada follows the reformation doctrine, granting courts broad authority to rewrite overbroad non-compete terms. This is the most employer-favorable approach — even a poorly drafted agreement may be reshaped into an enforceable restriction.
§ 5. Statutory Exemptions & Carve-Outs
Nevada law exempts certain workers from non-compete enforcement:
- Hourly wage employees (excluding tips)
§ 6. Consideration & Contract Formation
Adequate consideration required. Whether this is legally sufficient — especially for agreements presented mid-employment rather than at hiring — is frequently contested.
§ 7. Effect of Involuntary Termination
NRS 613.195(5): if employer terminates without cause, non-compete is unenforceable. Courts may apply heightened scrutiny when the employer initiated the termination, particularly for termination without cause or mass layoffs.
Practitioner Notes
Employer must pay the employee during the non-compete period if they challenge and the court finds it overbroad.