Washington State: Broad ban on non-competition agreements enacted

At a glance

• Washington State has enacted sweeping reforms to its non‑competition regime, placing it among the most restrictive US jurisdictions for post‑employment restraints.
• House Bill 1155 prohibits non‑competition agreements for almost all Washington‑based workers, regardless of compensation level, with very limited exceptions.
• The law significantly expands enforcement exposure, including statutory damages, attorneys’ fees and Attorney General enforcement.
• Employers will face new affirmative notice obligations to inform current and former workers that existing non‑competes are void.
• The new regime takes effect on June 30, 2027, giving employers a limited window to review and update existing arrangements.

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Washington State recently enacted sweeping changes to its noncompetition law, significantly expanding existing protections and placing the state among the most restrictive jurisdictions in the country for post‑employment restraints.

On March 23, 2026, Governor Ferguson signed House Bill 1155, which prohibits non-competition agreements for all Washington‑based workers except those working in federally recognized tribal nations, regardless of compensation level. The new law also expands enforcement mechanisms, narrows permissible non-solicitation provisions and imposes affirmative notice obligations on employers.

Below we discuss key provisions of the new law, which is scheduled to take effect on June 30, 2027.

A near‑total ban on non-competition agreements

Under HB 1155, all non-competition covenants are void and unenforceable for employees and independent contractors working in Washington. This represents a substantial departure from Washington’s existing law, which allows non-competition agreements for higher‑wage workers and subject to other conditions.

Importantly, the law makes it unlawful not only to enforce a non-competition agreement, but also to attempt to enforce, threaten enforcement, or represent to a worker that they are subject to a noncompetition restriction, even if the agreement was signed years ago.

Expanded definition of 'non-competition covenant'

The law defines 'non-competition covenant' broadly to include any agreement that:

• Restricts a worker from engaging in any lawful profession, trade, or business.
• Prohibits or deters acceptance of business from customers.
• Requires forfeiture, repayment, or return of compensation or benefits as a consequence of competing.

What agreements are still permitted?

While the law bans non-competition covenants, it preserves a narrow set of related restrictions, with some limitations:

• Non-solicitation agreements, limited to prohibiting solicitation of the employer’s current employees, or customers or clients with whom the worker had a direct relationship. These provisions must expire within 18 months following separation and may not bar acceptance of business.
• Confidentiality and trade secret protections, including covenants preventing disclosure or misuse of proprietary information.
• Business sale non-competes, but only where the individual owns at least 1% of the business being sold.
• Certain franchise‑related covenants, where statutory franchise requirements are met.
• Education expense repayment agreements, but only if they:
• Expire within 18 months of hire.
• Are prorated over time.
• Are waived when separation occurs for 'good cause.'

Employers should expect courts to construe these exceptions narrowly.

Enforcement exposure and employer obligations

The law meaningfully expands enforcement risk. A worker affected by a violation may recover the greater of:

• Actual damages.
• USD5,000 in statutory damages per violation, plus attorneys’ fees and costs.

The Washington Attorney General also has authority to pursue enforcement on behalf of aggrieved workers.

In addition, the law imposes a mandatory notice requirement. By October 1, 2027, employers must make reasonable efforts to notify, in writing, all current and former Washington‑based employees and independent contractors whose non-competition agreements would otherwise still be in effect that those agreements are now void and unenforceable.

Practical takeaways for employers

Although the law does not take effect until mid‑2027, employers are encouraged to begin preparing now, particularly in view of evolving state laws and federal enforcement activity. Actions to consider include:

• Auditing existing employment, contractor, and incentive agreements.
• Identifying provisions that may function as de facto non-competes.
• Revising template agreements to align with the new law.
• Developing a compliant notification strategy for affected workers.
• Training HR, legal, and recruiting teams on permissible post‑employment restrictions.

Please contact the authors or your DLA Piper relationship partner if you have questions about how this law may affect your workforce or existing agreements.