Utah Veterinary Non-Compete Law Changes

 

In March 2026, Utah's governor signed S.B. 111, the Veterinary Post-employment Amendments, into law. This law enacts meaningful changes to Utah's restrictive covenant law for veterinarians in Utah, with its key provisions going into effect on May 6, 2026.

S.B. 111, titled Veterinary Post-employment Amendments, reflects a growing policy trend in Utah limiting the enforceability of non-compete agreements arising out of employment for licensed professionals in Utah. The new law prohibits the use of post-employment non-compete agreements entered into on or after May 6, 2026, that restrict a veterinarian from practicing after separation from employment. It also places strict prohibitions on non-solicitation provisions and non-disclosure clauses that would prevent a departing veterinarian from discussing their work experience. Furthermore, the statute explicitly voids out-of-state forum selection clauses designed to bypass Utah's new restrictions.

A notable exception under the statute applies to business owners. S.B. 111 specifies that these prohibitions do not apply if a veterinarian holds an ownership interest of 5% or greater in the veterinary practice. For those holding such an equity stake, traditional non-competes and non-solicitation agreements may still be utilized and evaluated under existing common law and statutory standards under Utah law.

Of particular note is the bill’s fee-shifting mechanism. If an employer attempts to enforce a prohibited agreement against a veterinarian and does not prevail, the employer may be required to pay certain costs, attorneys’ fees and actual damages.

The policy rationale underlying the legislation is consistent with developments in other healthcare and specialized professions. Lawmakers have increasingly focused on the effect of restrictive covenants on client continuity of care and on the mobility of the veterinary workforce. Non-compete agreements can disrupt ongoing relationships by forcing providers to relocate or exit local markets. S.B. 111 reflects a legislative determination that these concerns outweigh the traditional employer interests in such restrictions, such as goodwill or other legitimate business interests.

From a compliance perspective, veterinary employers in Utah should promptly evaluate existing employment agreements and contracting practices before the May 2026 effective date. Any agreements drafted or entered into on or after May 6 containing prohibited non-compete, non-solicitation, or non-disclosure provisions that run afoul of the new law will be unenforceable and, more importantly, may create severe financial exposure if enforcement is pursued. Employers will need to consider alternative mechanisms to protect legitimate business interests, while ensuring that any remaining restrictive provisions are consistent with the statute. For employees, it's important to have any agreement presented to you reviewed for compliance with the new law and for analysis of the restrictive covenants under existing common law, where applicable.

Navigating employment law issues can be challenging. Whether you are an employee or employer with questions, Stavros Law P.C. is here to help. If you have questions about restrictive covenants, non-compete and/or non-solicit agreements, you can contact one of our Utah employment lawyers at Stavros Law by calling (801) 758-7604, emailing us (scheduling@stavroslaw.com), or visiting our website, (www.stavroslaw.com).

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