Are Non-Competes Enforceable for Therapists and Behavioral Health Staff in Iowa?

Iowa's non-compete rules come from case law, on this page's research: it surfaced no Iowa statute with duration caps, income floors or a therapist carve-out.

One reasonableness test decides a covenant whoever signs it — counselors, social workers, psychologists, BCBAs, RBTs and front-office staff alike.

• When it sticks: Iowa courts enforce a non-compete that is reasonably necessary to protect the employer's business, not unreasonably restrictive of the employee's rights, and not prejudicial to the public interest.
• Who proves it: you do — the employer carries the initial burden of proving the covenant is reasonably necessary.
• When it overreaches: absent employer bad faith, an Iowa court enforces an overbroad covenant only to the extent it is reasonably necessary, without undue hardship to the employee — it can be cut back rather than thrown out.

Start with what does not govern: the 2024 non-compete rule from the Federal Trade Commission was set aside by a federal district court in August 2024, and a final rule published in the Federal Register on February 12, 2026 removed it from the Code of Federal Regulations.

No federal ban on employee non-competes is in force.

In Iowa, this page's research surfaced no statute that generally governs employee non-competes — the Iowa Code was not searched exhaustively, so treat that as our finding, not a guarantee, and confirm with employment counsel.

What governs is case law, from two Iowa Supreme Court decisions:

• Iowa Glass Depot, Inc. v. Jindrich, 338 N.W.2d 376 (Iowa 1983) — Iowa will enforce a noncompetitive provision in an employment contract if the covenant is reasonably necessary for the protection of the employer's business and is not unreasonably restrictive of the employee's rights nor prejudicial to the public interest.
• Ehlers v. Iowa Warehouse Co., 188 N.W.2d 368 (Iowa 1971) — absent bad faith by the employer, Iowa courts enforce covenants to the extent reasonably necessary to protect the employer's legitimate interests without undue hardship to the employee. Ehlers overruled Brecher v. Brown (1945), under which courts had refused to modify covenants — so an Iowa court can narrow an overbroad clause instead of voiding it.

This page is Iowa only; the wider picture is in our guide to non-competes nationally.

Nothing in this research surfaced an Iowa statute restricting non-competes for counselors, social workers, psychologists, behavior analysts or private-practice prescribers — the hedge above applies.

The one healthcare-specific development this research surfaced is narrow.

Iowa Acts 2026, chapter 1173 (approved June 2, 2026) requires the Board of Regents to adopt a policy barring University of Iowa Hospitals and Clinics from including non-compete clauses in employment contracts with ARNPs, LPNs, pharmacists, physicians, physician assistants and registered nurses.

Taking effect upon enactment, it applies to UIHC contracts entered into, extended or renewed on or after June 2, 2026.

Two boundaries matter for a private practice:

• It binds UIHC only. It does not restrict private behavioral health employers — a group practice hiring a psychiatrist or psychiatric-mental health nurse practitioner gets neither a cap nor a safe harbor from it.
• It does not list behavioral health licenses. Counselors, social workers, psychologists and behavior analysts appear nowhere in it.

The honest summary: nothing in this research supports calling the 2026 law a statewide healthcare non-compete ban — it is a Board of Regents policy requirement for one hospital system.

Iowa's test is a reasonableness standard, not a table of numbers: courts ask whether the covenant is reasonably necessary to protect the employer's business, not unreasonably restrictive of the employee's rights and not prejudicial to the public interest.

• The burden starts with you. The employer carries the initial burden of proving the covenant is reasonably necessary to protect its business — so write down the interest you are protecting and size the covenant's time, area and activities to it.
• Proximity plus inside knowledge is the pattern courts rely on. Iowa courts have often relied on the employee's close proximity to customers along with peculiar knowledge gained through employment that provides a means to pirate the customer. A clinician's caseload is the closest analogue your practice has — so tie the covenant to an interest you can evidence, not a blanket radius.

There is no Iowa number in this research to copy.

No Iowa statute surfaced in this research, neither of the two decisions summarized above fixes a maximum duration or a mileage radius, and the test as quoted above carries no income screen.

Threshold rules do exist elsewhere: Illinois bars non-competes for employees earning $75,000 a year or less, rising to $80,000 from January 1, 2027.

A client non-solicitation clause bars a departing clinician from soliciting the clients they served; an employee non-solicit bars them from recruiting your staff.

Be careful transplanting Iowa's non-compete answer onto them: the decisions summarized here resolved non-compete disputes, and this page's research did not pull Iowa decisions on client or employee non-solicits, so we claim nothing about how an Iowa court would treat one.

The instinct that carries over is Jindrich's — a provable interest beats a sweeping one.

Don't assume either way on clinician-specific non-solicit rules in Iowa — nothing in this research addresses them.

Other legislatures have written them: Montana's MCA 28-2-724 bars employment, partnership or professional-relationship contracts with listed providers — expressly including licensed psychologists, social workers and professional counselors, plus licensed addiction counselors, marriage and family therapists and behavioral health peer support specialists — from restricting the provider, after the relationship ends, from practicing in any geographic area for any period or from treating or soliciting the employer's current patients, and since May 6, 2026 a Utah non-solicitation agreement cannot prevent a healthcare worker from telling a patient where they currently work or will work.

Nothing comparable surfaced in the Iowa research.

For drafting detail, ethics codes and other state examples, see our guide to non-solicitation clauses.

The case-law framework above leaves you room; use it deliberately.

• Shrink the covenant to the provable interest. Because you hold the burden, draft the covenant so its time, area and activities map onto something you can document.
• Protect the client list with confidentiality, not geography. Under the federal Defend Trade Secrets Act, business information — including compilations such as client lists — is a trade secret only if the owner took reasonable measures to keep it secret and it has independent economic value from not being generally known. Locked-down access and signed confidentiality terms do more work than a wide radius.
• Pick the narrower tool for the actual risk. Clients walking out the door points to a non-solicit; recouping BCBA supervision or training costs points to training repayment agreements, which carry their own state-by-state rules.
• Script the departure. The ethics codes your clinicians answer to already address the transition: NASW Code of Ethics standard 1.17(f) says a social worker leaving an employment setting should inform clients of appropriate options for continuing services and of the benefits and risks of the options, and BACB Ethics Code standard 3.16 requires behavior analysts to include the circumstances for transitioning a client to another behavior analyst in their service agreement and to provide a written transition plan.

Whatever the package, have employment counsel who practices in Iowa read the final wording before an offer goes out — the case law rewards precision.