§ 1. Governing Statutory & Common Law Authority
The enforceability of non-competition agreements in Oregon is governed by ORS § 653.295. Non-competes void unless employee earns above $119,541/year (2026). Maximum duration 12 months. Must be agreed upon in writing at hiring or with 2 weeks notice before promotion/additional consideration.
Recent legislative developments: 2021 amendments (effective Jan 2022) reduced max duration from 18 to 12 months and raised salary threshold significantly.
§ 2. Compensation Threshold Requirements
Oregon imposes a statutory compensation threshold for non-compete enforcement. Under current law, non-compete covenants are presumptively void for employees earning below the statutory minimum. 2026 threshold; adjusted annually based on BLS data. The threshold is $119,541/year — but whether your total compensation qualifies depends on how your state counts bonuses, commissions, and equity.
§ 3. Temporal Limitations on Post-Employment Restrictions
Oregon limits enforceable non-compete duration to 12 months from separation. Statutory maximum of 12 months (reduced from 18 months in 2022). Agreements exceeding this cap may be subject to judicial modification or voided entirely.
§ 4. Judicial Modification (Reformation Doctrine)
Oregon 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. Consideration & Contract Formation
Must be agreed upon in writing at time of hire, or with at least 2 weeks written notice before promotion/additional consideration. Whether this is legally sufficient — especially for agreements presented mid-employment rather than at hiring — is frequently contested.
§ 6. Effect of Involuntary Termination
Statute does not specifically address, but courts consider. Courts may apply heightened scrutiny when the employer initiated the termination, particularly for termination without cause or mass layoffs.
Practitioner Notes
Employer must provide a copy of the agreement when the offer is made.