§ 1. Governing Statutory & Common Law Authority
The enforceability of non-competition agreements in Wisconsin is governed by Wis. Stat. § 103.465. Non-competes enforceable under Wis. Stat. § 103.465 if necessary to protect the employer and reasonable. Wisconsin is a red-pencil state.
§ 2. Compensation Threshold Requirements
Wisconsin 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
Wisconsin does not codify a maximum duration. Courts look at reasonableness; typically 1-2 years. 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 (Red Pencil Doctrine)
Wisconsin applies the red pencil doctrine: if any provision is unreasonable, the entire non-compete is void. Courts will not rewrite the agreement. This places the drafting burden on employers and can benefit employees challenging overbroad restrictions.
§ 5. Consideration & Contract Formation
Continued employment is sufficient for at-will employees. Whether this is legally sufficient — especially for agreements presented mid-employment rather than at hiring — is frequently contested.
§ 6. Effect of Involuntary Termination
Courts consider whether the employer's conduct (e.g., termination) was in bad faith. Courts may apply heightened scrutiny when the employer initiated the termination, particularly for termination without cause or mass layoffs.
Practitioner Notes
Red-pencil doctrine makes Wisconsin riskier for employers with overbroad agreements.