Nevada's Modern Non-Compete Framework
Few areas of Nevada commercial law have shifted more in the last decade than non-compete enforceability. The legislature has twice rebalanced the burden — once in 2017 (AB 276), and again with SB 222 (effective 2021). Many non-competes drafted before those amendments are not enforceable as written, even if the employee signed.
What SB 222 Actually Changed
SB 222 prohibits non-competes for hourly workers and for employees terminated as part of a reduction in force, regardless of contract language. It also requires that any non-compete be supported by valuable consideration beyond continued employment, and that its duration, geographic scope, and scope of restricted activity all be no broader than necessary to protect the employer's legitimate business interest.
How Courts Apply the Reasonableness Standard
Nevada courts apply a three-part test: scope of activity, geographic reach, and duration. Restrictions on "any competitive activity" tend to fail. Restrictions on the specific role and the specific clients the employee handled tend to survive. Geographic clauses limited to where the employee actually worked are upheld; statewide or national clauses for a regional employee usually are not.
- Activity scope: what the employee can't do
- Geographic scope: where they can't do it
- Time scope: how long the restriction lasts (typically 6–12 months for sales roles, longer for true executives)
The Blue-Pencil Question
Nevada is now a blue-pencil state, meaning courts can rewrite an overbroad non-compete to make it enforceable rather than throw it out entirely. That cuts both ways for employees: a sloppily drafted clause won't necessarily be voided, but the rewriting power gives employees leverage to negotiate a narrower scope before litigation.
Strategy for the Employee
If you've received a cease-and-desist letter or a TRO motion, the first move is rarely the courtroom. Compare the contract to the SB 222 framework. Document the consideration you received (or didn't) at signing. Map your prospective new role against the actual restricted activity. In most cases, a well-supported response letter resolves the matter without litigation.