The Federal Noncompete Ban Is Dead. Wisconsin's Own Law Was Always Stricter.

If you heard in 2024 that noncompete agreements were about to be banned nationwide, then heard nothing else about it, here is the update: that ban is officially gone, and it was never going to change much for Wisconsin employers anyway.

What Happened to the Federal Rule

In April 2024, the Federal Trade Commission finalized a rule that would have banned nearly all noncompete agreements nationwide. It was blocked by a federal court within months and never took effect. The FTC spent the next two years fighting the decision in court, then reversed direction, withdrawing its appeals in 2025. In February 2026, the FTC made it official and formally removed the noncompete rule from federal regulations. There is no federal noncompete ban. There is not going to be one anytime soon.

Why Wisconsin Employers Should Not Relax

Here is the part that gets missed: even if the federal ban had gone into effect, Wisconsin employers were already operating under one of the strictest noncompete frameworks in the country. Wisconsin Statute 103.465 governs noncompete agreements in this state, and it does not give courts the option to fix a bad agreement. In many states, a judge can narrow an overly broad noncompete down to something reasonable. Wisconsin does not allow that. If a noncompete here does not meet every part of the state's enforceability test, the entire agreement is void, not adjusted.

That test requires the restriction to be genuinely necessary to protect the business, reasonable in both time and geography, not unreasonably harsh on the employee, not harmful to the public, and backed by real consideration. Agreements written for a business somewhere else, then copied into a Wisconsin employee's contract without adjustment, fail this test constantly.

What This Means in Practice

Employers do not need to react to news about a federal ban that no longer exists. What they do need is to stop assuming an old noncompete template is fine because it has always been used. A restriction that is too broad in Wisconsin does not get trimmed down when challenged. It disappears entirely, along with whatever protection it was supposed to provide.

If your agreements were drafted based on a national template, or drafted years ago without a Wisconsin-specific review, this is worth checking regardless of what happens at the federal level. The exposure was never about a rule from Washington. It has been sitting in state law the entire time.

This article is part of our HR Support & Insights for Wisconsin Businesses resource hub.