Tennessee Enacts Noncompete Restrictions

On May 7, 2026, Tennessee enacted House Bill 1034, which establishes a framework governing the enforceability of noncompete agreements. The law takes effect on July 1, 2026, and applies to any agreement entered into, renewed or amended on or after that date. The new law contains several provisions, including the following:

• Employers are prohibited from requiring, requesting or enforcing noncompete agreements against employees who earn less than $70,000 annually.
• A time restraint greater than two years for employees and independent contractors is presumed to be unreasonable.

The new law clarifies that employers may still use and enforce confidentiality or nondisclosure agreements, as well as non-solicitation agreements.