Federal & State Regulations | Non-compete agreements - Maryland

State Info

Summary of differences between federal and state regulations

Maryland employers may no longer require workers who earn less than $15 per hour (or $31,200 per year) to sign non-compete agreements, per SB 328. This new law allows employees to seek other employment in the same or similar type of business (think restaurant managers, retail workers, nonprofit employees, etc.).

Employers, however, may still impose customer non-solicitation agreements, or have other parameters around protecting company information.

Whether or not a non-compete agreement is a legal and binding contract depends on the scope of the restrictions the agreement includes, precedents set in court decisions, and a variety of other factors.

Some state courts have found that non-compete agreements are enforceable only if someone sells a business and agrees not to compete with the new owner. Typically courts do not want to deprive employees of earning a living in their chosen fields, but they also want to protect companies. So, a non-compete agreement might be enforceable, but only if it is reasonable in scope and necessary to protect the company's interests.