§ 1. Governing Statutory & Common Law Authority
The enforceability of non-competition agreements in Utah is governed by Utah Code § 34-51-201 et seq. (Post-Employment Restrictions Act, 2016). Non-competes limited to 1 year under Post-Employment Restrictions Act (2016). The Act also provides that if a court enforces a non-compete, the employer must pay the employee's attorney fees.
Recent legislative developments: 2016 Act established 1-year limit.
§ 2. Compensation Threshold Requirements
Utah 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
Utah limits enforceable non-compete duration to 12 months from separation. Statutory maximum of 1 year. Agreements exceeding this cap may be subject to judicial modification or voided entirely.
§ 4. Judicial Modification (Reformation Doctrine)
Utah 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
Utah law exempts certain workers from non-compete enforcement:
- Broadcast employees
§ 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
Courts consider circumstances. Courts may apply heightened scrutiny when the employer initiated the termination, particularly for termination without cause or mass layoffs.
Practitioner Notes
Employer may be required to pay employee's attorney fees if non-compete is enforced.