Montana non-compete law: MCA 28-2-703 and the 2025 health care changes

Montana starts from a statute that voids restraints on a lawful profession, trade or business: MCA 28-2-703 makes them void "to that extent," with exceptions only for selling a business's goodwill and dissolving a partnership. Montana courts still enforce some employee non-competes as partial restraints, but they construe them strictly, require a legitimate business interest, and since Wrigg (2011) generally refuse to enforce one when the employer ended the job. On top of that, MCA 28-2-724 now bars non-competes and patient non-solicits for physicians of every specialty (for contracts made or renewed from January 1, 2026), nurses, physician assistants and several behavioral health licensees. That is the law as of October 2026.

For recruiters, Montana means two different conversations: for health care candidates, the license and the date the contract was signed or renewed often decide the answer; for everyone else, how the candidate is leaving matters more than in most states. The general screen is in non-compete questions for candidates, and agency-side clauses are in non-solicitation clauses for recruiters.

What does Montana law say about non-competes?

MCA 28-2-703 reads: "Any contract by which anyone is restrained from exercising a lawful profession, trade, or business of any kind, otherwise than is provided for by 28-2-704 or 28-2-705, is to that extent void." The two statutory exceptions are:

• MCA 28-2-704: a person who sells a business's goodwill may agree not to carry on a similar business in the city or county of the principal office, adjacent counties or cities in them, for as long as the buyer carries on a like business there.
• MCA 28-2-705: partners may agree, on dissolution, that one or more of them will not carry on a similar business within those same areas.

The words "to that extent" have let Montana courts treat a reasonable employee covenant as a permissible partial restraint rather than an automatically void one. In Dobbins, DeGuire & Tucker, P.C. v. Rutherford, MacDonald & Olson (1985), the Montana Supreme Court reviewed an accounting firm's covenant by asking whether it was limited in time or place, based on good consideration, and no broader than needed to give the employer fair protection without unreasonable hardship on the employee. Later cases describe covenants not to compete as disfavored in Montana and read them strictly.

Can a Montana employer enforce a non-compete after letting someone go?

Generally no, and this is the Montana rule recruiters most need to know. In Wrigg v. Junkermier, Clarke, Campanella, Stevens, P.C. (2011), the Montana Supreme Court required the employer to show a legitimate business interest, meaning the restriction is necessary to protect goodwill, customer relationships or trade information, before a court even looks at reasonableness. It then held that an employer lacks a legitimate business interest in a covenant when, under ordinary circumstances, it is the employer that ends the employment relationship.

That makes the reason for leaving a fact the hiring company's counsel will want. A candidate who resigned to take a better offer is in a different position from one whose role was eliminated or whose contract was not renewed. You do not need the details of a dismissal; you need to know, in the candidate's words, whether they left or the employer ended it, and to pass that on without characterizing it.

Which health care workers are covered by MCA 28-2-724?

MCA 28-2-724, first enacted in 2023, says a contract establishing employment, a partnership or another professional relationship with a listed health care provider may not restrict the provider's right, after the relationship ends, to practice in any geographic area for any period, to treat or establish a relationship with any current patient of the employer, or to solicit those patients. Three 2025 session laws changed it:

The section as it stands in the Montana Code Annotated 2025 covers physicians, psychologists, naturopathic physicians, social workers, professional counselors, addiction counselors, marriage and family therapists, behavioral health peer support specialists, registered nurses, advanced practice registered nurses and physician assistants. Under subsection (3) it does not apply to a contract in connection with the sale and purchase of a practice, or to a provision requiring a physician to repay money paid or advanced (a bona fide loan, relocation cost, signing bonus, education expense or tuition) under a payback provision that decreases over time.

The applicability dates are the catch. A cardiologist whose contract was signed in 2024 and not renewed since is outside the all-physician change, which reaches contracts made or renewed on or after January 1, 2026, although the general 28-2-703 analysis and the Wrigg rule still apply. Healthcare recruiters should therefore capture two facts: the license, and when the agreement was signed or last renewed.

Montana non-compete rules at a glance

What should a recruiter ask a Montana candidate?

Ask the same question of everyone for the role, early in the phone screen, and record the answers as facts.

MONTANA CANDIDATE — restrictive agreements

1. "Have you signed a non-compete, a customer or patient non-solicit,
    or a confidentiality agreement with your current or a past employer?"
2. "How long does it last after you leave, and what area or clients
    does it cover?"
3. "Are you leaving by your own choice, or is the employer ending
    the role?" (record their words; do not probe the reasons)
4. Health care roles: "Which Montana license do you hold, and when was
    your contract signed or last renewed?"
5. "Was it part of selling a practice or business, or a repayment
    agreement for a bonus, loan or relocation?"
6. "Does it say which state's law applies or where disputes go?"
Always: "We don't want any confidential information, documents or
patient or client lists from your current employer."

• Do not tell a physician "Montana banned those." The all-physician change depends on when the contract was made or renewed, and repayment clauses survive.
• Do not ask why someone was let go. The question is only whether the employer ended the relationship.
• Do not ask a clinician for patient lists or to contact patients before they start.

What is the risk to the hiring company?

For non-health care roles, the realistic risk is a lawsuit seeking an injunction, which in Montana starts with the former employer proving a legitimate business interest. For covered health care providers, a restriction barred by 28-2-724 should not be enforceable, but repayment obligations can still follow the clinician, and the hiring practice may be asked to fund or reimburse them as part of the offer. In any field, former employers sometimes name the new employer, for example alleging interference with the contract or misuse of confidential information; that depends on what the new employer knew and did, which is for its counsel.

Practical steps: flag every covenant to the client before final interviews, get counsel to review any agreement with a governing-law clause pointing outside Montana, and repeat at the offer that the company wants no confidential information. Use the offer call script to confirm any repayment amounts the candidate expects to owe.

Is Montana likely to change its non-compete law again?

The Legislature meets in regular session in odd-numbered years; under MCA 5-2-103 it convenes on the first Monday of January (or the first Wednesday if January 1 is a Monday), so the next regular session opens in January 2027. The 2025 session amended 28-2-724 three times; 28-2-703 to 28-2-705 were not changed. Re-check the Code after the 2027 session before relying on this summary.

Where does the federal FTC rule stand?

It does not apply. The FTC's Noncompete Rule page notes the August 20, 2024 court order; the Commission voted on September 5, 2025 to accede to the vacatur; and a February 12, 2026 notice removed it from the Code of Federal Regulations. Montana law governs Montana covenants.

Staffing agencies and their own agreements

Agencies that ask their own recruiters to sign non-competes face the same 28-2-703 starting point and the same Wrigg problem if the agency is the one that ends the relationship. Healthcare staffing firms placing physicians, nurses or physician assistants should check their own clinician contracts against 28-2-724 for anything signed or renewed after the 2025 changes. For the rest of the Montana picture, see hiring employees in Montana, the Montana staffing agency license guide and Montana drug testing laws.

A Montana checklist

• Restrictive-agreement question asked of every candidate, in the same words.
• Whether the candidate left or the employer ended the relationship recorded in the candidate's words.
• Health care roles: license type and signing or renewal date captured.
• Repayment clauses (bonus, loan, relocation, tuition) noted for the client.
• No opinion on enforceability given; candidate pointed to their own lawyer.
• Code re-checked after the January 2027 session.