Indiana Non-Compete Agreement

Indiana courts apply the common law reasonableness test: (1) Is it necessary to protect a legitimate employer interest? (2) Is the duration reasonable (typically 1–2 years)? (3) Is the geographic scope limited to the area where the employee worked? (4) Is the scope of prohibited activity narrowly defined? Courts look at the totality of circumstances.

Yes. Indiana courts blue-pencil overbroad non-competes by reducing duration or geographic scope to make them enforceable. The court will not, however, write an entirely new agreement. This makes precise drafting important — include severability language and a provision stating that courts may modify the agreement to the maximum enforceable extent.

Yes, for primary care physicians. Under Indiana SB 5 (2023), non-compete agreements for primary care physicians are limited to 2 years, 50-mile radius, and only enforceable if the employer continues paying the physician's salary during the restriction period. Specialty physicians and other healthcare workers are not yet covered by SB 5.

Yes. Customer non-solicitation clauses (preventing the employee from soliciting employer clients they personally served) are more readily enforced than blanket competition bans. Indiana courts view non-solicitation as a less severe restriction on the employee's livelihood. Non-solicitation of employees (anti-poaching clauses) are also generally enforceable.