Maryland law limiting or prohibiting non-competition agreements and conflict of interest provisions was recently amended to add specific provisions related to the employment of licensed architects. HB 1016, which applies to agreements or clauses executed on or after the law’s October 1, 2026, effective date, renders non-competes and conflict of interest provisions void and unenforceable for licensed architects in the state if their employer relocates the majority of its workforce or its principal place of business outside of Maryland.
Specifically, the amendments prohibiting such covenants apply to a licensed architect who is employed by an employer that:
- On the first day of the employee’s employment, employs more than 30 employees, the majority of whom report to a primary worksite in Maryland or perform work remotely from within the state, and
- On the enforcement date, does not have the majority of its employees report to a primary worksite located in Maryland or perform work remotely from within the state, nor does it have its principal place of business located in the state.
The “enforcement date” referred to above means the date upon which an employer seeks to enforce a non-compete or conflict of interest provision through the filing of a lawsuit, initiation of arbitration proceedings, or makes a written demand to the employee to comply with the provision. That is to say, the ban applies only after the employer has made the requisite out-of-state relocation changes for the majority of its workforce.
The Latest in Several Limitations on the Use of Non-Competes in Maryland
These amendments are just the latest in a series of changes to Maryland law limiting or prohibiting the use of non-competition agreements in the state.
Maryland began applying income restrictions on non-competes in 2019 when it voided non-competes and conflicts of interest provisions restricting competitive employment or self-employment for employees earning less than a designated income threshold. In 2023, Maryland updated its non-compete statute to raise the threshold to 150% of the state's minimum wage.
In 2024, Maryland again expanded its restrictions on non-competes, banning them for veterinarians and veterinary technicians, regardless of the amount earned by such personnel. It also imposed a “low wage” threshold for some healthcare providers working in direct patient care and making $350,000 or less in total compensation annually. For direct patient care health care providers earning more than $350,000 per year, non-competes must be limited to one year in duration and ten miles in geographic scope.
If you have questions about these changes to Maryland law or about the use and enforceability of non-competes generally, please contact the Employment and Labor Law attorneys at Tydings.