Non-compete clauses (clauses that attempt to stop you from working for a competitor after you leave) are under pressure across Canada. Ontario has already banned most of them, other provinces heavily scrutinize them in court, and the Federal Government is now contemplating a ban of its own, for federally regulated workplaces (such as employees in telecommunications and banking). If you’re an employee who’s been asked to sign one, or an employer relying on them, the ground is shifting quickly.

Ontario: an outright statutory ban

Ontario went furthest. Under the Working for Workers Act, 2021, it amended the Employment Standards Act, 2000, to prohibit non-compete agreements for most employees, effective October 25, 2021. A non-compete in a standard employment contract signed on or after that date, is generally void and unenforceable.

There are two narrow exceptions:

  • Genuine executives: President, CEO, CFO, and similar C-suite roles
  • Sale of a business: where the seller stays on as an employee of the buyer

Outside those exceptions, Ontario employees generally can’t be bound by a non-compete.

Other provinces: highly scrutinized, but not banned

Most other provinces haven’t legislated an outright ban, but that doesn’t mean non-competes are freely enforceable:

  • Quebec has long regulated them under the Quebec Civil Code. A non-compete must be in writing and reasonable in duration, geographic scope, and the type of work restricted, and it’s read narrowly against the employer.
  • The common-law provinces (British Columbia, Alberta, and others) leave non-competes to the courts, which are historically hostile to them. A clause is only enforceable if it protects a legitimate proprietary interest and goes no further than reasonably necessary. Many are struck down as overly broad.

The practical theme across the country is the same: non-competes are hard to enforce, and getting harder.

The coming federal change: Bill C-31

The momentum is now reaching the federal level. Bill C-31, the Budget 2025 Implementation Act, No. 2, received first reading in May 2026, which includes a proposed amendment to the Canada Labour Code that would prohibit non-compete agreements.

This matters because it targets federally regulated employees: those in sectors like banking, telecommunications, interprovincial transportation, and others governed by the Canada Labour Code. These workplaces currently fall outside Ontario’s provincial ban, and non-compete enforceability there still turns on common-law reasonableness. If Bill C-31 passes into law, it would bring federally regulated employees broadly into line with the direction Ontario has already taken, closing one of the last gaps where non-competes still have real room to operate.

As with Ontario’s ban, the federal measure is expected to include exceptions; the precise carve-outs will depend on the final legislation_._

What’s still allowed everywhere

Importantly, the shift against non-competes doesn’t touch every restrictive clause. Across jurisdictions, employers can generally still use:

  • Non-solicitation clauses: limiting you from poaching clients or colleagues
  • Confidentiality and trade-secret clauses: protecting genuinely sensitive information

These remain enforceable where reasonably drafted, so it’s essential to know which type of clause you’ve actually signed: they’re often confused.

What this means for you

If you’re an employee, a non-compete you’ve been handed may already be unenforceable, depending on where you work and when you signed it, and the law is trending in your favour.

If you’re an employer, relying on non-competes is an increasingly fragile strategy. Well-drafted non-solicitation and confidentiality clauses are usually the more durable way to protect your business.

The rules genuinely differ by province, by sector, and by the date on your contract. If you’re not sure where a non-compete leaves you, reach out for a consultation: a short review can tell you quickly whether that clause is worth worrying about.