§ 1. Governing Statutory & Common Law Authority
The enforceability of non-competition agreements in Vermont is governed by Common law. Non-competes enforceable if reasonable. Very limited statutory or case law specific to non-competes.
§ 2. Compensation Threshold Requirements
Vermont 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
Vermont does not codify a maximum duration. Reasonableness standard. 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)
Vermont 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
Adequate consideration required. Whether this is legally sufficient — especially for agreements presented mid-employment rather than at hiring — is frequently contested.
§ 6. Effect of Involuntary Termination
Very limited case law. Courts may apply heightened scrutiny when the employer initiated the termination, particularly for termination without cause or mass layoffs.
Practitioner Notes
Very limited precedent on non-competes.