Non-Compete Agreements in Tech: What Engineers Should Know

You're reviewing a job offer and buried on page 12 is a clause that says you can't work for a competitor for 18 months after leaving the company. If you're a software engineer and your company considers Google, Meta, Amazon, Apple, Microsoft, and every funded startup a "competitor" — that clause could effectively freeze your career for a year and a half.

Non-competes in tech are increasingly common, increasingly controversial, and increasingly regulated. Here's what you need to understand.

The Basics

A non-compete clause restricts your ability to work for a competing business for a specified period after your employment ends. In tech, this typically means restrictions on joining companies that offer competing products or services.

Three dimensions determine how restrictive a non-compete is:

Duration: How long does the restriction last after you leave? 6 months is relatively common and moderate. 12 months is standard for mid-to-senior roles. 24 months or more is aggressive for anyone below the C-suite.

Geographic scope: Where does the restriction apply? "Within a 50-mile radius" is narrow. "Within the United States" is broad. "Worldwide" is very broad and harder to enforce.

Activity scope: What can't you do? "You can't work for Company X's direct competitors" is narrow. "You can't work in the technology industry" is so broad it's likely unenforceable in most jurisdictions.

California: The Exception

If you work in California, non-compete agreements are generally void. California Business and Professions Code Section 16600 establishes that contracts restraining people from engaging in a lawful profession are void, with very limited exceptions.

This means even if your employment agreement contains a non-compete clause and you signed it, it's likely unenforceable if California law applies. Some employers include non-competes in California agreements anyway — either because they use a national template or because the agreement specifies a different state's law as governing. California courts have generally applied California's policy even in these situations when the employee works in California.

Other States: The Reasonableness Test

Most other states enforce non-competes but apply a "reasonableness" standard. Courts consider whether the restriction is reasonable in duration, geographic scope, and activity scope, and whether the employer has a legitimate business interest to protect (trade secrets, client relationships, specialized training investments).

Recent trends favor employees. Several states have introduced income thresholds below which non-competes can't be enforced. Illinois, Colorado, Oregon, Washington, and others now require that employees earn above a certain amount before a non-compete is valid. Some states require employers to provide notice of the non-compete at the time of the offer or pay additional consideration.

The Layoff Question

One of the most common questions in tech right now: does the non-compete apply if I get laid off?

In most agreements, yes. Unless the non-compete specifically says it's waived upon involuntary termination without cause, it applies regardless of who ends the relationship. This creates a situation where the company can eliminate your position and still restrict where you work for the next 12-18 months.

Some states are addressing this. A few have passed or proposed laws voiding non-competes when the employer initiates the termination without cause. But this is not universal — check the law in your state and read your specific agreement.

The Garden Leave Question

"Garden leave" is a provision where the company continues to pay you during the non-compete period. This is common in finance and increasingly appearing in senior tech roles. If your agreement includes garden leave, the non-compete is more likely to be enforced because the company is compensating you for the restriction.

If there's no garden leave provision, you're being asked to sit out the market — potentially losing hundreds of thousands of dollars in compensation — for free. Courts in some jurisdictions consider the lack of compensation during the restricted period when evaluating enforceability.

What To Look For In Your Agreement

Read the non-compete clause with these questions in mind:

How long is the restriction? Is the duration reasonable for your role and seniority?

How broad is the definition of "competitor"? Does the agreement define it specifically, or is it broad enough to include most companies you'd want to work for?

Does the non-compete apply if the company terminates you? Is there a carve-out for layoffs or termination without cause?

Is there garden leave or any other compensation during the restricted period?

What state's law governs the agreement? This matters enormously for enforceability.

Analyze Your Non-Compete

Paste your employment agreement into dott.legal and get an instant analysis of your non-compete clause — including duration, scope, and jurisdiction-specific enforceability considerations. Free in 30 seconds.

For senior roles where the non-compete could significantly impact your career options, the attorney-validated review ($349) provides detailed legal analysis specific to your situation and jurisdiction.