Non-Solicitation Clauses in Colorado After the 2022 Reform
Colorado's Updated Restrictive Covenant Law
Colorado significantly tightened its rules on restrictive covenants with HB 22-1317, effective August 10, 2022. This law directly impacts non-solicitation of customers clauses, creating new income thresholds and procedural requirements employers must follow.
Customer Non-Solicitation: Income Threshold
Under the 2022 law, non-solicitation of customers clauses are only enforceable against workers who earn at or above 60% of the threshold amount for highly compensated workers as defined by the Colorado Department of Labor and Employment. For 2024, this means the employee must earn approximately $75,000 or more annually. Below that income, customer non-solicitation clauses are void.
Notice and Disclosure Requirements
Colorado imposes strict procedural requirements:
- The employer must provide a separate written notice to the employee that a non-solicitation clause is part of the agreement
- Notice must be given before the worker accepts the offer or, for existing employees, at least 14 days before the effective date
- The agreement must identify the specific clause by name
- Failure to comply with these notice requirements renders the clause void
What Courts Still Evaluate
Even when procedural requirements are met, the clause must:
- Protect a legitimate business interest
- Be no broader than reasonably necessary
- Be reasonable in duration (typically one to two years)
- Be limited to customers with whom the employee had direct dealings
Red Flags
- No written notice was provided before you accepted the job
- Your compensation falls below the statutory threshold
- The restriction covers customers you never interacted with
- Duration exceeds two years
When to Consult a Lawyer
Consider consulting a Colorado employment attorney if you were not given proper notice of a non-solicitation provision, if your income falls near the statutory threshold, or if a former employer is threatening enforcement of a clause that may not comply with the 2022 law.
This article is for informational purposes only and does not constitute legal advice. Consult a licensed attorney for guidance specific to your situation.