Payroll Client AccessCan Wisconsin Employers Use Non-Compete Agreements? Requiring Non-Compete Agreements in WI
Wisconsin law allows employers to require employees to sign non-compete agreements, but non-competes face strict scrutiny and are only enforceable if they meet specific legal standards. Non-compete agreements must be reasonably necessary to protect legitimate business interests, such as trade secrets or key customer relationships. They must also be limited in scope, duration and geographic area.
Overly broad or restrictive agreements are considered void and unenforceable. Wisconsin courts prioritize employee mobility and will not enforce non-competes unduly restricting a person's right to work.
BenHR keeps your company current and compliant. Contact us today for more information.
BenHR Services & Resources
Legal Standards for Non-Compete Agreements in Wisconsin
Requirements for Enforceability
Wisconsin Statute § 103.465 governs non-compete agreements. If requirements are not met, Wisconsin courts will void the entire agreement. For a non-compete to be enforceable, it must satisfy all of the following criteria:
- Necessary for Employer Protection: The agreement must protect a legitimate business interest, such as confidential information, trade secrets or customer goodwill—not just prevent competition for its own sake.
- Reasonable Duration: The time period must be reasonable. Wisconsin courts often uphold restrictions of up to two years, but longer periods may be considered excessive.
- Reasonable Geographic Scope: The agreement must clearly define the geographic area where competition is restricted. Broad, undefined or nationwide restrictions are likely to be struck down.
- Not Overly Restrictive: The agreement cannot impose greater restrictions than necessary. It must balance the employer’s interests with the employee’s ability to earn a living.
- Clear and Specific Terms: Vague or ambiguous language will render the agreement unenforceable. Every restriction must be clearly defined.
The Evolving Legal Landscape
Wisconsin currently permits non-compete agreements meeting certain standards, but the legal environment remains dynamic. The Federal Trade Commission (FTC) issued a rule in 2024 seeking to ban most non-competes nationwide, but a federal court blocked the rule and its future remains uncertain. For now, Wisconsin law governs, but employers should watch for potential changes.
Why Work with BenHR on Non-Compete Agreements?
BenHR’s HR consultants specialize in drafting and reviewing non-compete agreements tailored to your business and compliant with Wisconsin law. BenHR shields your business from costly litigation and keeps your employment practices current. Don’t risk using outdated or unenforceable agreements. Consult BenHR for expert support and peace of mind. Our team:
- Crafts enforceable, narrowly tailored agreements to protect your interests
- Reviews existing contracts for legal compliance
- Guides evolving state and federal regulations
- Trains managers on best practices for contract execution