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

Yes — with a drafting test that has no safety net.

Wisconsin courts will enforce a non-compete signed by a therapist, counselor, social worker, psychologist or BCBA, but only if the covenant's restrictions are reasonably necessary for the protection of the employer under Wis. Stat. § 103.465.

If any restraint is unreasonable, the statute makes the covenant “illegal, void and unenforceable even as to any part of the covenant or performance that would be a reasonable restraint.”

Two features define Wisconsin.

First, the covenant has to be right when you write it: the statute voids the whole covenant rather than letting a court trim it back to a reasonable core.

Second, § 103.465 has no rule specific to any behavioral health license, so the license your clinician holds does not change the test — the wording of the covenant does.

For the states that ban these covenants, the ones with healthcare-specific statutes, and the federal picture, see our guide to non-competes nationally.

Both: one statute, interpreted through a long line of Wisconsin Supreme Court decisions.

The statute is Wis. Stat. § 103.465, which makes an employee covenant not to compete, within a specified territory and time, lawful only if its restrictions are reasonably necessary for the protection of the employer — and voids a covenant that imposes an unreasonable restraint in its entirety.

The cases supply the working test.

Chuck Wagon Catering v. Raduege (1979) set out the five requirements Wisconsin courts still apply, listed below.

Star Direct, Inc. v. Dal Pra, 2009 WI 76, established that separate covenants in one contract can survive independently when they support different interests and can be read and enforced on their own.

Runzheimer International v. Friedlen, 2015 WI 45, held that an employer's forbearance from firing an at-will employee is lawful consideration for a restrictive covenant signed during employment.

And Manitowoc Co. v. Lanning, 2018 WI 6, brought employee non-solicitation clauses inside the statute.

On the statute itself, the amendment history for § 103.465 shows no amendment after 2015.

For Wisconsin, the answer is none in the statute that governs employee covenants.

Wis. Stat. § 103.465 has no rule specific to counselors, social workers, marriage and family therapists, psychologists, behavior analysts, nurses or physicians — the same reasonableness test applies to a counselor, a BCBA and a psychiatrist hire alike, and the statute's history shows no amendment after 2015.

That makes Wisconsin different from states that have legislated specifically for behavioral health.

Montana, for example, expressly names licensed psychologists, social workers and professional counselors in its healthcare non-compete statute, Montana Code Annotated § 28-2-724.

Wisconsin's § 103.465 has no comparable provision, so nothing about a therapist's or behavior analyst's license changes the analysis — only the covenant's wording does.

One scope note: this page's research verified § 103.465 and its amendment history.

If you need certainty that no other Wisconsin statute or pending bill touches your staff's contracts, ask Wisconsin employment counsel to check before you rely on a template.

Wisconsin courts test a covenant against five requirements, set out in Chuck Wagon Catering v. Raduege (1979).

The covenant must:

• be necessary for the protection of the employer — the legitimate-business-interest element;
• provide a reasonable time period;
• cover a reasonable territory;
• not be unreasonable to the employee; and
• not be unreasonable to the general public.

Fail any one and the covenant is void in its entirety — including any part that would have been reasonable on its own.

Overreach costs you the whole covenant, not just the excess.

One exception matters for drafting.

Under Star Direct (2009 WI 76), courts may enforce separate covenants in one contract that support different interests and can be read and enforced independently, even if another covenant is void; covenants textually intertwined with a void one fall with it.

Consideration is settled too: under Runzheimer (2015 WI 45), an employer's forbearance from exercising its right to fire an at-will employee is lawful consideration for a covenant signed mid-employment.

What this page cannot give you is a number.

Its research did not cover the terms or radii Wisconsin courts accept for clinical staff — the reasonableness of a given time period and territory is decided case by case.

Size both to the interest you can actually defend, and have Wisconsin employment counsel review the wording before you rely on it.

Employee non-solicits sit inside the statute, not outside it.

Manitowoc Co. v. Lanning (2018 WI 6) applied § 103.465 to a clause barring a former employee from soliciting, inducing or encouraging the employer's employees — so a clause stopping a departing clinician from recruiting your staff must pass the same five-factor test, with the same all-or-nothing stakes.

Client non-solicits can work, but the drafting is unforgiving.

In Star Direct, the Wisconsin Supreme Court held reasonable and enforceable a clause barring a former employee from contacting “past customers,” defined as those who had purchased from the employer within one year before termination.

Note the limits of that analogy: Star Direct was a sales case, not a healthcare one, so treating its one-year, defined-customer shape as a template for a therapy or ABA practice is drafting judgment, not a holding.

What is clearly on record is the failure mode: a Wisconsin client clause with no geographic restriction barring contact with company clients has been held overbroad, and any part of an indivisible covenant falls if another part is unreasonable.

The workable shape, then, is a clause tied to a defined, recent client set rather than “any client of the practice,” reviewed by counsel like every other covenant.

For how these clauses interact with the ethics codes your clinicians practice under, and what happens when a client wants to follow a departing clinician, see our guide to non-solicitation clauses.

Draft narrow, because there is no trim.

Put a specific term and a specific territory in the covenant and name the interest each clause protects.

Because an unreasonable restraint voids the covenant in its entirety, the cost of overreach is the whole instrument — which is why the client non-solicit should not be tangled into the same clause as the non-compete.

Build covenants to stand alone.

Star Direct rewards covenants that support different interests and can be read and enforced independently.

Structure the non-compete, the client non-solicit and the employee non-solicit as separate, self-contained clauses, and have Wisconsin employment counsel confirm the drafting supports divisibility rather than assuming it.

Get the signature mechanics right.

Sign restrictive covenants at hire.

If you introduce one mid-employment, Runzheimer means continued at-will employment counts as consideration in Wisconsin — pairing the new signature with a real benefit is still the cleaner practice, and counsel can tell you what holds up.

Remember your non-solicits are tested too.

After Manitowoc, an employee non-solicit faces the same reasonableness test, so keep it specific to the working relationships you are actually protecting.

Match the tool to the exposure.

Where what you are really protecting is the money you put into a clinician's training or supervision, a repayment clause is a different instrument with its own rules — see our guide to training repayment agreements before adding one to a Wisconsin agreement.