Rhode Island Non-Compete Agreement

Introduction

Key Things to Know

1. 1

   Rhode Island governs employee non-competes through a named statute, the Rhode Island Noncompetition Agreement Act (R.I. Gen. Laws chapter 28-59), effective January 2020. It does not ban non-competes outright, but Section 28-59-3 makes one unenforceable against four protected groups of workers, so in Rhode Island eligibility is the threshold question, not scope.

2. 2

   Section 28-59-3 names the four workers a Rhode Island non-compete cannot bind: an employee who is nonexempt under the Fair Labor Standards Act, an undergraduate or graduate student intern, an employee age 18 or younger, and a low-wage employee. A clause signed by any of them is unenforceable here, however carefully it is written.

3. 3

   The low-wage carve-out turns on earnings, not job title. Section 28-59-2 treats a worker as low-wage when average annual earnings are not more than 250 percent of the federal poverty level for individuals. Because that HHS figure is republished each year, verify the current guideline before applying it, and do not borrow another state's fixed salary cutoff for Rhode Island.

4. 4

   For a worker outside the four categories, the Rhode Island Act names no maximum term and no mileage limit. Enforceability then rides on common-law reasonableness, under which a Rhode Island court generally looks for a legitimate business interest and a restraint reasonable in time and geographic scope, no broader than necessary.

5. 5

   Rhode Island imposes no advance-notice period, no right-to-counsel statement, and no garden-leave pay, unlike the Massachusetts statute the Act resembles. Consideration falls under Rhode Island contract law, which generally demands something of value, and whether continued at-will employment alone supports a mid-employment non-compete is fact-specific.

6. 6

   Overbreadth is not automatically fatal in Rhode Island. Courts here generally follow partial enforcement, narrowing an excessive restraint to what is reasonable rather than voiding it, and several covenants sit outside the Act altogether under Section 28-59-2: nonsolicitation covenants, NDAs, invention-assignment agreements, and sale-of-business covenants.

7. 7

   Because protected workers cannot be bound and other non-competes face a reasonableness test, Rhode Island employers frequently rely instead on a confidentiality or nonsolicitation agreement and the Rhode Island Uniform Trade Secrets Act (chapter 6-41), which Section 28-59-3 expressly leaves intact.

Rhode Island Requirements for Non-Compete Agreement

• Enforceable Under the Noncompetition Agreement Act

  In Rhode Island an employee non-compete is enforceable, but the Rhode Island Noncompetition Agreement Act (R.I. Gen. Laws chapter 28-59, effective January 2020) makes one unenforceable against four categories of workers. For employees outside those categories, a non-compete must still protect a legitimate business interest and be reasonable in duration and geographic scope under Rhode Island common law. A restraint that exceeds those bounds may be narrowed or refused.

• Low-Wage Employees Cannot Be Bound

  Rhode Island has a wage-based carve-out. Section 28-59-2 defines a low-wage employee as one whose average annual earnings are not more than 250 percent of the federal poverty level for individuals under the HHS poverty guidelines, and Section 28-59-3 makes a non-compete unenforceable against such an employee. Because the guideline updates each year, confirm the current figure (roughly $39,125 using the 2025 individual guideline) and do not rely on another state's fixed salary number.

• Other Protected Worker Categories

  Beyond low-wage employees, Section 28-59-3 makes a non-compete unenforceable against employees who are nonexempt under the federal Fair Labor Standards Act (most hourly, overtime-eligible workers), undergraduate or graduate students in an internship or short-term job, and employees age 18 or younger. A non-compete against any of these workers cannot be enforced in Rhode Island, regardless of how narrowly it is drafted.

• No Statutory Duration or Geography Cap

  The Rhode Island Act sets no maximum number of months and no fixed geographic limit for a non-compete. For a worker outside the protected categories, enforceability turns on common-law reasonableness: courts in Rhode Island generally require a legitimate business interest, such as trade secrets, confidential information, or customer goodwill, and a restraint reasonable in duration and geographic scope and no broader than necessary. Tie the restriction to where the employee worked and keep it as short as the interest allows.

• No Notice or Garden-Leave Mandate

  Unlike some states, Rhode Island does not require advance notice before signing, a right-to-counsel statement, or garden-leave pay during the restricted period. Consideration is governed by Rhode Island contract law, which generally requires something of value for the promise. Whether continued at-will employment alone is enough for a non-compete signed after employment has started is a fact-specific question best confirmed with counsel.

• Nonsolicitation and NDA Covenants Are Outside the Act

  Section 28-59-2 excludes several covenants from the definition of a noncompetition agreement, so the worker carve-outs do not restrict them: covenants not to solicit or hire employees, covenants not to solicit customers, clients, or vendors, nondisclosure or confidentiality agreements, invention-assignment agreements, sale-of-business covenants by a significant owner receiving significant consideration, and separation agreements giving the employee at least seven business days to rescind. These are analyzed under general Rhode Island reasonableness principles.

• Courts May Narrow an Overbroad Clause

  Rhode Island courts generally follow partial enforcement, meaning a court may in its discretion narrow an overbroad non-compete and enforce it only to the extent reasonable, rather than voiding it outright. This is a case-law approach, not a statutory guarantee, and a court may refuse to rewrite a clause it views as drafted unreasonably or in bad faith. Because a non-compete cannot bind protected workers, Rhode Island employers often protect information with a confidentiality or nonsolicitation agreement and the Rhode Island Uniform Trade Secrets Act (chapter 6-41) instead.

• Federal FTC Rule Is Not in Force

  The 2024 Federal Trade Commission non-compete rule was set aside by a federal court before it took effect, so it is not currently binding, and its status remains unsettled. Rhode Island does not depend on it: the Rhode Island Noncompetition Agreement Act (chapter 28-59) independently governs non-competes here, barring them against low-wage, FLSA-nonexempt, intern, and under-19 workers and otherwise applying common-law reasonableness.