Non-Compete Agreement Analyzer
Non-Competes for Low-Wage Workers: Why They're Increasingly Unenforceable
Fast food workers, retail employees, and other low-wage workers are often given non-competes they don't need to honor. Learn your rights and which states protect you.
Non-competes for low-wage hourly workers — fast food employees, home care aides, retail workers, call center staff — are one of the most egregious examples of corporate overreach in employment law. These agreements trap workers in jobs, suppress wages, and have no legitimate business justification. Regulators, state legislatures, and courts have increasingly concluded that low-wage non-competes are unenforceable, and many states have now explicitly banned them. Here's what you need to know if you're in this situation.
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The Problem: Non-Competes Have Spread to All Wage Levels
Non-competes were originally designed for executives and highly skilled professionals who possessed valuable trade secrets or unique client relationships. Over the past two decades, employers began imposing them on everyone: hourly retail workers, sandwich shop employees, hairdressers, dog walkers, and home health aides.
A 2019 study from the Economic Policy Institute found that approximately 18% of all U.S. workers — including many making near minimum wage — are covered by non-compete agreements. Many of these workers sign without understanding what they've agreed to, without access to legal counsel, and without negotiating power.
The FTC estimated that 30 million workers were covered by non-competes when it proposed its ban in 2023. A significant portion of these are in low-wage positions.
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States That Explicitly Protect Low-Wage Workers
Multiple states have enacted salary thresholds below which non-competes are automatically void:
| State | Threshold (approx.) |
|---|---|
| Illinois | $75,000/year |
| Colorado | ~$123,750/year (2024, indexed to inflation) |
| Washington State | ~$123,656/year (2024, indexed) |
| Maine | $455/week |
| Maryland | $15/hour |
| New Hampshire | $15/hour |
| Virginia | $15/hour (low-wage threshold) |
| Rhode Island | ~$37.94/hour |
| D.C. | Broad restrictions including low-wage workers |
If you earn below your state's threshold, your non-compete is void as a matter of law — not just likely unenforceable, but legally null. You don't need a court to tell you it's invalid; the statute already says so.
Why Low-Wage Non-Competes Fail the Reasonableness Test
Even in states without explicit salary thresholds, low-wage worker non-competes are highly vulnerable because they typically fail the 'legitimate business interest' test:
Trade secrets: Does a cashier, home care aide, or sandwich maker have access to trade secrets? Realistically, no. The knowledge to make a sandwich or ring up a sale is not a protectable trade secret.
Specialized training: Did the employer invest substantial resources in specialized training that gives the employee unique market value? A two-day orientation does not qualify.
Client relationships: Does the employee have significant, personal client relationships that the employer needs to protect? For most hourly roles, the answer is no.
Without any legitimate business interest to protect, the non-compete serves only one purpose: suppressing wages by preventing workers from moving to competitors who might pay more. Courts are increasingly recognizing this and refusing to enforce these agreements.
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The FTC's Position and Its Impact
The FTC's proposed rule to ban most non-competes (struck down in 2024, removed from CFR in February 2026) was specifically motivated in part by concerns about low-wage workers. Even though the rule didn't survive, the FTC found that non-competes:
- Suppress wages by preventing workers from taking better-paying jobs at competitors
- Cost workers an estimated $250–$296 billion in suppressed wages annually
- Disproportionately affect workers of color and women
- Provide no legitimate benefit for low-wage workers where no trade secrets exist
The regulatory signal is clear even without the rule: federal regulators view low-wage non-competes as anti-competitive and harmful.
The FTC has also brought enforcement actions against specific employers who used non-competes against hourly workers, including a janitorial services company that imposed non-competes on low-wage cleaners.
What You Can Do If You Have a Low-Wage Non-Compete
Step 1: Check your state's salary threshold law. If your earnings are below the threshold, stop worrying — the agreement is void.
Step 2: Research your state's general non-compete law. Even without a salary threshold, courts in many states would refuse to enforce a non-compete against an hourly worker.
Step 3: If your employer is threatening enforcement, take the threat seriously enough to consult an employment attorney — but know that your position is strong. The cost of a consultation ($0–$250 for an initial call) is worth knowing whether you're actually at risk.
Step 4: If you're considering taking a new job at a competitor and worried about the non-compete, assess the realistic enforcement risk: Does your employer have the resources and motivation to sue? Would the lawsuit be economically justified for a $12/hour worker? Most employers won't spend $20,000+ in legal fees to enforce a non-compete against a low-wage employee.
Step 5: Contact your state's labor board or attorney general if your employer is systematically using non-competes against low-wage workers — this may be actionable.
Reporting Employers Who Misuse Non-Competes
If you're a low-wage worker being coerced by an unenforceable non-compete:
State attorney general: Several state AGs have investigated and taken action against employers using unlawful non-competes against low-wage workers. File a complaint.
FTC: File a complaint at reportfraud.ftc.gov. The FTC tracks non-compete abuse and uses complaint data for enforcement priorities.
State labor board: If the non-compete is part of a pattern of coercing workers, the labor board may investigate.
Private lawsuit: In some states, using an unenforceable or illegal non-compete against a worker is itself actionable. Consult a plaintiffs-side employment attorney.
Still have questions? Read the FAQs below — or let the AI handle it for you →
Frequently Asked Questions
Quick answers to the most common questions on this topic.
I make $13/hour. Does my non-compete matter?
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In many states, no. Check whether your state has a salary threshold below which non-competes are void. Even in states without explicit thresholds, a non-compete against an hourly worker with no access to trade secrets is likely unenforceable. The practical risk of enforcement is also very low — employers don't typically spend $20,000+ suing minimum-wage workers.
Can a fast food chain enforce a non-compete against a part-time worker?
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Major fast food chains largely abandoned non-competes for hourly workers following public pressure and regulatory scrutiny in 2018–2019. If you're a current fast food employee with a non-compete, check your contract's date and your state's law. Pre-2019 contracts from these companies are generally not being enforced.
My employer said I can't work at any competitor within 10 miles. Is this enforceable?
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For a low-wage role: probably not, especially if you're below your state's salary threshold or if your role doesn't involve any trade secrets or significant client relationships. The 'legitimate business interest' required to justify even a geographically narrow restriction is absent for most hourly workers.
I was never given a copy of my non-compete. Does it still apply?
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If you signed something, you're generally bound by it even if you didn't keep a copy. Request a copy from HR immediately — they're required to provide it. Review it to understand what you actually agreed to. If they can't produce a signed copy, your liability is significantly reduced.
Can I be fired for refusing to sign a non-compete?
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In at-will employment states, yes — you can be fired for refusing to sign. But if you're fired and your state's law would have made the non-compete void anyway, you likely have a stronger unemployment claim. Consult an attorney before refusing to sign if your job is at stake.