Non-Compete Agreements in Louisiana: Are They Enforceable?

Louisiana is a state that enforces non-compete agreements, subject to strict requirements under Louisiana Civil Code Article 1755. Article 1755 provides that an agreement not to engage in a lawful profession, trade, or business is null unless it is ancillary to a valid contract and the restriction is reasonable in light of the subject matter of the contract. Louisiana courts have interpreted "reasonable" to mean the non-compete must be limited in duration, geographic area, and type of business activity, and must protect a legitimate business interest such as trade secrets, confidential information, substantial relationships with prospective or existing customers, or unique and specialized training provided by the employer.

Unlike federal law, Louisiana imposes on the employer the burden of proving that the non-compete is reasonable. The employee or job applicant can challenge the restriction, and courts will blue-pencil (modify) overly broad agreements only in narrow circumstances. Louisiana courts are generally reluctant to modify non-competes and may void them entirely if they are unreasonable. The state recognizes non-competes as legitimate protections of business interests, but only when they do not unfairly prevent an employee from earning a livelihood in their profession.

Louisiana also has specific rules for physician non-competes under La. Rev. Stat. § 9:2871. Physician non-competes are enforceable only if they are reasonable in duration (typically not more than two years), geographic scope, and if the physician is compensated during the non-compete period or if the practice is sold. This statute provides greater protection to physicians than to other professionals, recognizing the public interest in access to healthcare.

State courts apply Louisiana Civil Code Article 1755 in civil actions brought by employers seeking to enforce non-competes. Remedies available include injunctive relief (court orders prohibiting the employee from competing) and damages for breach. Employees may also seek declaratory judgment that a non-compete is void and unenforceable. The state does not require legislative approval or filing of non-competes; they are enforceable based on the private agreement between employer and employee.

Non-compete agreements that completely prohibit an employee from earning a livelihood in their profession are presumptively void under Louisiana Civil Code Article 1755. Non-competes unrelated to a legitimate business interest—such as trade secrets, confidential customer information, goodwill, or unique training—are not enforceable. If a non-compete is ancillary to an employment contract but lacks temporal or geographic limitation, it will likely be struck down as unreasonable. Non-competes tied to terminated employment without compensation may be unreasonable, particularly in the case of physicians, who must be compensated during the restriction period unless they sold their practice.

Louisiana courts have held that non-competes imposed after an employee begins work, without consideration (i.e., without additional payment or benefit), may be unenforceable because they lack mutual assent and adequate consideration. Non-competes that restrict competition in an area where the employer does not conduct business are unreasonable. Similarly, non-competes lasting longer than necessary to protect the legitimate business interest will be voided. Employer bad faith—such as using a non-compete to retaliate against an employee for union activity or refusing to accept the terms—may also render the agreement void.

Public policy exceptions apply in certain contexts. For instance, non-competes that would prevent the employee from working in their licensed profession (such as healthcare) for an unreasonable period may be void as against public policy. Non-competes unilaterally imposed by employers without employee input or choice may be viewed unfavorably. If an employer breaches the employment contract or terminates the employee without cause, a court may find the non-compete unenforceable as a matter of fairness.

STEP 1: Document the non-compete agreement. Obtain a copy of the non-compete clause from your employment contract, offer letter, or any standalone agreement signed at or after hire. Retain evidence of when you signed it, what consideration (if any) you received, and any communications about its terms. Keep records of your job duties, the employer's business operations, customer relationships, and any trade secrets or confidential information you had access to. Document the date you left employment and any communications from your employer about the non-compete restriction.

STEP 2: Assess the reasonableness of the non-compete. Review the restriction's duration (how long it lasts), geographic scope (what area it covers), and line of business (what activities are prohibited). Determine whether the employer has a legitimate business interest—trade secrets, customer lists, goodwill, or specialized training. If the non-compete appears overly broad, indefinite, or unrelated to a legitimate interest, you have strong grounds to challenge it. Consider whether you received any compensation, promotion, or other benefit when signing the agreement.

STEP 3: Consult an employment attorney in Louisiana. Non-compete cases are highly fact-specific and require analysis of Louisiana Civil Code Article 1755. An attorney can advise you on whether the restriction is likely enforceable, help you respond to any cease-and-desist letter from the employer, and represent you in court if the employer seeks injunctive relief. If you are considering accepting a new job and the former employer threatens legal action, an attorney can advise on your legal exposure.

STEP 4: Respond to employer enforcement actions. If the employer sends a cease-and-desist letter or threatens legal action, do not ignore it. Provide a copy to your attorney immediately. The employer may file a lawsuit in Louisiana state court (district court) seeking an injunction to stop you from working in your new job and/or damages for breach. You will have an opportunity to respond and argue that the non-compete is unreasonable and void. The burden is on the employer to prove the non-compete is reasonable, which works in your favor.

STEP 5: Pursue affirmative relief if needed. If you have already begun working in a new position and face threats, you or your attorney can file a declaratory judgment action asking the court to declare the non-compete void and unenforceable before the employer sues. This proactive approach can resolve the matter quickly. You may also pursue damages if the employer's actions caused harm—such as job loss, emotional distress, or attorney fees—though such claims are less common in non-compete cases. Louisiana courts may award attorney fees to the prevailing party if the non-compete is found unreasonable.