Bobadilla v. Non-Competes
On non-competes, the 2020 restrictions you might have missed, and the agreements that protect what you're actually worried about.
A founder is hiring their first employee and wants maximum protection for everything they’ve built, so they ask their buddy Claude to whip up a non-compete. But here’s the thing, Washington State significantly restricted non-compete agreements in 2020. Many of them are either: blissfully unaware (fun, but not all that helpful), feeling good about agreements they found online that don’t do what they used to (also fun), drafting their own agreement with inadequate AI prompts or secondary review (less fun when the output doesn’t match the intent), or in the stressful swirl of not knowing which way is up. A good number of them are working with agreements that are simply not enforceable (deterrent isn’t an unworthy goal).
But the more interesting problem isn't enforceability. It's that most founders are using non-competes to solve a problem that a non-compete was never the right tool for in the first place.
What Washington's Law Actually Says
Since January 1, 2020, non-compete agreements in Washington are unenforceable unless they meet specific requirements. The employee must earn more than $100,000 per year (that’s more than $128,000 in 2026), adjusted annually for inflation. Independent contractors must earn more than $250,000 per year. The agreement must be disclosed before the employee accepts the job offer, not on the first day of work, not buried in an onboarding packet. The duration cannot exceed 18 months without the employer being able to prove by clear and convincing evidence that a longer period is necessary. And if the employee is laid off, the employer must either pay the employee their base salary for the duration of the restriction or agree not to enforce it.
That last one catches employers off guard more than any other provision. You can't lay someone off and then enforce a non-compete that prevents them from working in their field without continuing to pay them. That's not a technicality. That's the law.
If your existing non-compete agreements were signed before 2020 or don't meet these requirements, they may not be enforceable. If you've been relying on them for protection you think you have, it's worth finding out before you need to invoke them.
The Bigger Problem
Here's what I see more often than outright unenforceable agreements. Founders using non-competes to accomplish something a non-compete isn't designed to do.
The typical concern isn't really that a departing employee will open a competing business across the street. It's that they'll walk out the door with client relationships they spent years building on your dime. Or that they'll share proprietary processes, pricing strategies, or product information with a competitor. Or that they'll use their inside knowledge to help someone else undercut you in a proposal or a pitch.
Those are real concerns. They're also not what a non-compete addresses, at least not directly or reliably. A non-compete says you can't work for a competitor or start a competing business. It doesn't say you can't share what you know. It doesn't protect your client list. It doesn't prevent someone from using institutional knowledge they developed while working for you, which courts have consistently treated as belonging to the person, not the employer.
What actually addresses those concerns is a well-drafted confidentiality agreement combined with a non-solicitation agreement. Confidentiality protects your proprietary information, your pricing, your processes, your strategies, the things that are actually yours. Non-solicitation prevents a departing employee from taking your clients or recruiting your team for a set period. Together they protect what founders are actually trying to protect, and unlike a non-compete, they don't run into the income thresholds, disclosure requirements, and layoff restrictions that make Washington non-competes so difficult to enforce.
They're also harder for a departing employee to challenge because they're more narrowly tailored. A court looking at a non-compete asks whether the restriction is reasonable given the employee's role and the employer's legitimate interests. A court looking at a confidentiality agreement asks whether the information was actually confidential and whether the employee agreed to protect it. The second conversation is easier to win.
What To Do With The Agreements You Have
If you have non-compete agreements in place with current employees, it's worth knowing whether they meet Washington's current requirements. The income thresholds, the timing of disclosure, the duration limits, and the layoff provision are all checkpoints worth running your existing agreements against.
If they don't meet the requirements, that doesn't mean you're completely unprotected. It means the non-compete clause specifically may not be enforceable, but other provisions in the same agreement, confidentiality, non-solicitation, intellectual property assignment, may still hold. The whole document doesn't fail because one clause is unenforceable. Washington's severability doctrine generally preserves the rest.
If you're onboarding new employees and planning to include non-compete language, make sure the agreement is presented and signed before the job offer is accepted, that the income threshold is met, and that the duration is 18 months or less. If you're not sure whether the role justifies a non-compete at all given the income requirement, the answer is probably to focus your energy on a strong confidentiality and non-solicitation agreement instead.
The Practical Question
Before you reach for a non-compete, ask what you're actually trying to protect. If the answer is client relationships, proprietary information, or insider knowledge, the document you need is a confidentiality and non-solicitation agreement. If the answer is preventing a senior, highly compensated employee from immediately going to work for a direct competitor in a role where they'd use your trade secrets against you, and that employee earns over the threshold, a non-compete may be appropriate.
Most of the time the first answer is the right one. The second situation exists but it's narrower than most founders assume when they ask for a non-compete.
- m
