On March 24, 2026, Washington Governor signed House Bill 1155 amending various provisions related to non-competition and non-solicitation agreements, amendments which take effect on June 30, 2027.

Non-Competition

The amendment makes all non-competition covenants void and unenforceable and prohibits an employer from enforcing, threatening to enforce, entering into, or representing that an employee is subject to a non-competition covenant.

Employers must make reasonable efforts to provide written notice by October 1, 2027, to current and former employees and independent contractors who are within the effective time period of the noncompete covenant that the noncompete covenant is void and unenforceable.

A non-competition covenant does not include: (1) non-solicitation agreements; (2) confidentiality agreements; (3) a covenant prohibiting use or disclosure of trade secrets or inventions; (4) a covenant entered into by a person purchasing or selling the goodwill of a business or otherwise acquiring or disposing of an ownership interest, as long as the person signing the covenant purchases, sells, acquires, or disposes of an ownership interest of one percent or more of the business; and (5) written agreements to repay out-of-pocket educational expenses if the agreement a) expires within 18 months of the employee’s start date, b) limits repayment to the pro rata portion of the remaining time of the 18-month period, and c) releases the employee from the obligation to repay if the employee’s separation is based on good cause, as defined in Washington’s unemployment compensation statute.

Non-Solicitation

Non-solicitation agreements that prohibit employees from actively solicitating current customers or employees away from the employer are permitted but must be narrowly construed.

The amendment revises the definition of non-solicitation agreements as an agreement between an employer and employee that prohibits, upon termination of employment of any employee of the employer to leave the employer, the solicitation of any current or prospective customer, patient, or client of the employer to shift business away from the employer if the employee had established or substantially developed a direct relationship with the customer, client, or prospective client through the employee’s work with the employer. The non-solicitation agreement must expire no later than 18 months following the employee’s termination of employment.

Employer Takeaways

Employers should review any current any current non-competition and non-solicitation agreements in anticipation of these amendments’ effective date of June 30, 2027, and ensure that proper notice is given by October 1, 2027.

Stokes Wagner will continue to monitor updates and will provide additional updates as they become available. If you have any questions, do not hesitate to contact a Stokes Wagner attorney.

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THIS DOCUMENT PROVIDES A GENERAL SUMMARY AND IS FOR INFORMATIONAL/EDUCATIONAL PURPOSES ONLY. IT IS NOT INTENDED TO BE COMPREHENSIVE, NOR DOES IT CONSTITUTE LEGAL ADVICE. PLEASE CONSULT WITH COUNSEL BEFORE TAKING OR REFRAINING FROM TAKING ANY ACTION.