Updated March 01, 2024
A New Mexico non-compete agreement allows an employer to restrict an employee from working in the same or similar field to protect the business’s legitimate interests. A non-compete is required to specify the duration and geographical area where the employee is prohibited to work.
Laws
Legally Enforceable?
Yes, a non-compete is legally enforceable in New Mexico if the court deems them reasonable.
The primary purpose of a non-compete cannot be to simply “stifle competition.” An agreement must impose partial restraint of a specific trade no larger than reasonably required to protect the employer.[1]
Health Practitioners (prohibited)
“Health practitioners,” as defined by the New Mexico statutes are prohibited from entering into a non-compete:[2][3]
- Dentists;
- Osteopathic physicians;
- Physicians;
- Podiatrists;
- Certified registered nurse anesthetists;
- Certified nurse practitioner; and
- Certified nurse-midwifes.
Termination Without Cause
If an employee is terminated without cause, the non-compete is not enforceable and would not be recognized by a New Mexico court.[4]
Continued Employment
An employee’s continued employment may be deemed as sufficient consideration for a non-compete. Even a New Mexico court have not clearly defined it as such, they have ruled in favor of post-employment non-compete agreements.[1]
Maximum Term
3 years was deemed reasonable for restricting a profession for a county in New Mexico.[5]
Blue Penciling
New Mexico courts have not given a definitive ruling on where it stands in regard to amending, reforming, or modifying non-compete agreements.