A Colorado non-solicitation agreement covering customer relationships is enforceable only if three things are true: the worker earns at least $78,008.40 per year (the 2026 threshold), the restriction is no broader than reasonably necessary to protect the employer’s trade secrets, and the employer delivered a specific written notice in a separate document within the required timing window. Miss any of the three and the agreement is void under Colorado Revised Statutes Section 8-2-113, and the employer faces a $5,000 penalty per affected worker on top of actual damages and attorney fees.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions
The statute draws a line between two kinds of non-solicitation. A clause that restricts a former worker from contacting the employer’s customers carries the compensation threshold, the trade-secret limit, and the notice rules described below. A clause that restricts a former worker from recruiting the employer’s staff is still judged under general reasonableness standards from earlier case law and does not trigger the compensation threshold.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions Most fights are over customer non-solicitation, and the rest of this article focuses there.
The Compensation Threshold
A customer non-solicitation clause binds a worker only if the worker earns at least 60 percent of Colorado’s highly compensated worker threshold. That threshold moves each year. For 2026 it is $130,014, which puts the non-solicitation cutoff at $78,008.40.2Colorado Department of Labor and Employment. Proposed 2026 PAY CALC Order 7 CCR 1103-14
The timing rule is the part that trips employers up. The worker must clear the threshold both on the day the agreement is signed and on the day the employer tries to enforce it.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions A demotion, a cut in hours, or a move into a lower-paying role after signing can void the clause even for a worker who was well above the line at signing.
Compensation for this purpose means annualized cash compensation. Salary and cash bonuses count. Health insurance, retirement contributions, and equity awards do not. A package that only clears the threshold once benefits are added in will not hold up.
The comparable figure for a non-compete agreement is 100 percent of the highly compensated threshold, or $130,014 for 2026, so non-solicitation clauses can reach a broader group of workers than non-competes can.
What the Restriction Can Protect
Clearing the pay threshold is not enough. The statute allows a customer non-solicitation clause only where it is “no broader than reasonably necessary to protect the employer’s legitimate interest in protecting trade secrets.”1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions Trade secret protection is the only legitimate interest that supports a restriction on a departing employee. Ordinary goodwill, general client contact information, or a desire to keep former employees away from the market do not qualify.
Courts look closely at the fit between the restriction and the trade secrets it claims to guard. A clause that blocks a worker from contacting every customer in the employer’s database, including customers the worker never touched, is almost certainly overbroad. Enforceable clauses are narrow: limited to customers the worker actually serviced, and tied to confidential pricing or strategy the worker actually saw. The further the restriction reaches beyond the worker’s real knowledge, the harder it becomes to defend.
Duration is judged the same way. Colorado sets no statutory ceiling, but the time period has to be reasonable for the trade secrets involved. Most enforceable agreements sit somewhere between six months and two years. Longer restrictions may be defensible for specialized technical roles; industries with rapid client turnover often justify shorter ones.
The Notice the Employer Must Deliver
Even a properly scoped agreement fails without correct notice. The employer must give the worker a written notice, in a document separate from the agreement itself and separate from any other covenants, and the worker must sign it. The notice has to be in the language the employer and worker normally use for performance discussions.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions
The notice itself must do three things: identify the agreement by name, state plainly that the agreement contains a covenant that could restrict the worker’s options after leaving, and point the worker to the exact sections of the agreement where the restrictive language sits.
Timing depends on when the agreement is presented. A prospective employee must get the notice before accepting the offer. A current employee must get it at least 14 days before whichever comes first: the covenant’s effective date, or the effective date of any raise or changed terms that serve as consideration for signing.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions The 14-day window exists so the worker can consult a lawyer or negotiate. Slipping a non-solicitation clause into an employee handbook or an onboarding packet alongside tax forms does not satisfy the separate-document rule.
Choice-of-Law Clauses Do Not Rescue Out-of-State Employers
Some employers headquartered elsewhere try to sidestep Section 8-2-113 by writing a choice-of-law clause selecting a friendlier state. The statute closes that door. For any worker who primarily resided or worked in Colorado when they left the company, Colorado law governs enforceability regardless of what the contract says, and the worker cannot be forced to litigate the question in another state’s courts.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions
This matters most for remote workers. If you live and work in Colorado for a company based in Texas or Delaware, the Colorado rules apply to your agreement no matter what the fine print says.
Penalties and Remedies
Colorado does not simply void bad agreements. An employer that enters into, presents, or attempts to enforce a non-solicitation agreement violating Section 8-2-113 faces a $5,000 penalty per worker or prospective worker harmed by the conduct.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions The affected worker can also recover actual damages, reasonable costs, and attorney fees in a private suit. Both the worker and the Colorado Attorney General can seek injunctive relief to stop ongoing enforcement.
A limited good-faith defense exists. If the employer can show the violation was unintentional and that it had reasonable grounds to believe the agreement was lawful, the court has discretion to reduce or eliminate the $5,000 penalty. That defense does not touch actual damages or attorney fees. Where the Attorney General has already recovered damages or penalties on behalf of workers, those workers cannot recover the same amounts again in a separate action.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions
Overbroad Agreements and the Blue Pencil Question
Employers sometimes draft aggressive restrictions on the theory that a judge will trim the clause down to something enforceable rather than throw the whole thing out. Colorado courts have the discretion to do that, but they are not required to, and a severability or reformation clause in the contract cannot force them to. If the original restriction is grossly overbroad, a court is more likely to void it than to rewrite it. Draft narrowly, or expect to lose the clause entirely.
Agreements Signed Before August 10, 2022
The current statutory framework applies to agreements entered into on or after August 10, 2022. Older agreements are evaluated under the prior case law, which did not impose the specific compensation threshold or the notice rules but did require reasonableness in scope and duration and a legitimate business interest.1Justia. Colorado Code 8-2-113 – Unlawful to Intimidate Worker – Agreement Not to Compete – Prohibition – Exceptions – Notice – Rules – Definitions Pre-2022 agreements are not automatically enforceable; they still fail if they were unreasonable when signed or no longer serve a real purpose. The threshold and notice requirements simply do not apply retroactively.
No Federal Rule Changes the Analysis
The Federal Trade Commission announced a rule in April 2024 that would have banned most non-compete agreements nationwide, and some observers expected effects on non-solicitation clauses as well. That rule never took effect. A federal district court found the FTC lacked the authority to issue it, and in September 2025 the FTC filed to dismiss its appeals and accede to the rule’s vacatur.3Federal Trade Commission. Federal Trade Commission Files to Accede to Vacatur of Non-Compete Clause Rule Section 8-2-113 is the governing law for Colorado workers, with no federal overlay expanding or limiting it.