Are Non-Competes Enforceable in Tennessee? Your Rights Explained

In Tennessee, non-compete agreements are enforceable, but only when a court finds them reasonable. Tennessee has no statute that bans non-competes for ordinary employees and, unlike a growing number of states, it has no low-wage or salary-threshold exemption that automatically frees lower-paid workers from these contracts. Instead, Tennessee courts apply a common-law reasonableness test that has been the law since the Tennessee Supreme Court's decision in Hasty v. Rent-A-Driver, Inc. A non-compete is enforced only if the employer has a legitimate, protectable business interest and the restriction is no broader than necessary in its duration, geographic reach, and the scope of activities it forbids. There is one important statutory exception: Tennessee has a specific law governing non-competes for physicians and other healthcare providers, discussed below.

The Reasonableness Test Tennessee Courts Actually Use

Because Tennessee handles non-competes through case law rather than a single statute, the controlling standard comes from court decisions. A restrictive covenant is enforceable only when it is supported by adequate consideration and is reasonable under the circumstances. Tennessee courts weigh several factors, including:

• The consideration supporting the agreement — what the employee received in exchange for signing (a job offer, a promotion, specialized training, access to trade secrets, or other benefits).
• The threatened danger to the employer if the agreement is not enforced.
• The economic hardship the restriction imposes on the employee.
• Whether the restriction is against the public interest.

Critically, an employer cannot use a non-compete simply to keep an employee from competing. Tennessee courts require a legitimate protectable business interest — typically trade secrets, confidential business information, or customer relationships and goodwill that the employee was in a position to take advantage of. Ordinary skills and general knowledge an employee develops on the job are not, by themselves, enough to justify enforcing a non-compete.

Reasonable Time and Geography

Tennessee has no fixed statutory limit on duration or geographic scope for general employees, so reasonableness depends on the facts. As a practical matter, Tennessee courts have frequently upheld restrictions of one to two years when the geographic area and activity restrictions are tied to where the employer actually does business and to the customers the employee served. A nationwide ban with no time limit, by contrast, is unlikely to survive. The narrower and more closely tied the restriction is to a real business interest, the more likely a court is to enforce it.

Tennessee Courts Can "Blue-Pencil" an Overbroad Agreement

One feature workers should understand is that Tennessee follows a reasonable-modification (blue-pencil) approach. If a non-compete is overly broad, a Tennessee court is not required to throw the whole thing out. The court may instead modify the agreement — for example, by shortening the time period or shrinking the geographic area — and then enforce the narrowed version. This means signing an overbroad agreement on the assumption that "a court will never enforce something this aggressive" is a risky bet in Tennessee.

The Healthcare Provider Exception (the Closest Thing to a Statute)

The one area where Tennessee has codified specific rules is healthcare. Tennessee law (Tenn. Code Ann. § 63-1-148) expressly permits non-compete agreements for physicians and certain other licensed healthcare providers, but it places defined limits on them. Under that statute, a healthcare-provider non-compete is generally enforceable only if its duration does not exceed two years and its geographic restriction is limited to a defined area — commonly described as the greater of a set mileage radius from the provider's primary practice site or the county in which the provider primarily practiced. Because the exact mileage and definitions are technical and have been refined over time, any healthcare worker should confirm the current text of § 63-1-148 directly before relying on it. The key takeaway is that healthcare-provider non-competes are not unlimited in Tennessee — they are bounded by statute.

Is There a Ban for Low-Wage Workers in Tennessee?

No. As of 2026, Tennessee has not enacted a law that bars non-competes for low-wage, hourly, or salaried workers below a certain income level. Several other states (such as Illinois, Maine, and Washington) have set salary floors below which non-competes are void, but Tennessee has not joined them. That makes it especially important for Tennessee workers at every pay level to read what they sign. A worker earning an hourly wage can still be bound by a non-compete in Tennessee if it meets the reasonableness test — though a low wage and significant economic hardship are factors a court may weigh in the employee's favor.

What About the Federal Non-Compete Ban?

You may have heard that the Federal Trade Commission issued a rule in 2024 that would have banned most non-competes nationwide. That rule was challenged in court and set aside before it took effect, so it is not in force. As of 2026, there is no federal ban on non-competes, and Tennessee workers remain governed by Tennessee law. Federal law still sets baseline labor protections in other areas — for example, the Fair Labor Standards Act (FLSA) sets a federal minimum wage of $7.25 per hour and requires overtime after 40 hours in a workweek for non-exempt employees — but the FLSA does not address non-competes.

For context on wages: Tennessee has no state minimum wage law of its own, so the federal FLSA rate of $7.25 per hour applies to most covered employers in the state. Because wage rates and exemptions can change, confirm the current figure with the official source before relying on it.

What to Do If You Are Asked to Sign or Are Being Threatened

Whether you are facing a new agreement or a threat to enforce an old one, a few practical steps protect you:

• Read it before you sign. Note the duration, the geographic area, the activities restricted, and whether it also includes non-solicitation or confidentiality clauses. You can ask to negotiate scope, carve-outs, or severance triggers before signing.
• Get a copy and keep it. Keep the signed agreement, your offer letter, and anything describing what you received in exchange (training, a bonus, a promotion). Consideration is central to enforceability in Tennessee.
• Don't assume it's unenforceable. Because Tennessee courts can modify overbroad agreements, you should not treat an aggressive non-compete as a bluff.
• Be cautious about your next move. If you are leaving for a competitor, avoid taking documents, files, customer lists, or other confidential materials. Misappropriating information can expose you to separate trade-secret claims.
• Respond carefully to a cease-and-desist letter. A former employer's demand letter is not a court order. But ignoring it can lead to a lawsuit and a request for an injunction in Chancery Court. Consider a written, measured response.
• Talk to a Tennessee employment lawyer. Enforceability turns on fact-specific reasonableness, so individualized advice is valuable, especially before you change jobs.

Where to Verify and Get Help

Non-compete disputes in Tennessee are decided by the courts (typically Chancery Court), not by a state agency, and the Tennessee Department of Labor and Workforce Development does not enforce or adjudicate non-compete agreements. The Department of Labor and Workforce Development is, however, the state's official agency for wage, workplace, and labor-standards questions, and it is a reliable place to confirm wage rules and find worker resources. For the underlying non-compete law, the controlling sources are Tennessee court decisions and, for healthcare providers, Tenn. Code Ann. § 63-1-148, which you can review through the official Tennessee Code. Because legal standards evolve and individual contracts differ, confirm the current law with the official statute and consult a licensed Tennessee attorney before acting on a specific agreement.

Official Tennessee Sources

This page is based on Tennessee employment law. Rules and figures change — verify the current details directly with the official Tennessee sources below. This is general legal information, not legal advice.

• Tennessee Department of Labor & Workforce Development — official Tennessee agency.
• How to Begin a Wage Claim - Tennessee Labor Standards Unit

Federal law and local ordinances may also apply. Federal laws like the Fair Labor Standards Act set a national floor, and your city or county may add protections (such as a higher local minimum wage or paid sick leave). Check both alongside Tennessee state law.