Are employee non-compete agreements enforceable in Hawaii?
Sometimes, but Hawaii starts from an antitrust rule. HRS 480-4(a) makes every in-state restraint of trade illegal, and HRS 480-4(c) allows only restrictive covenants that are ancillary to a legitimate purpose and do not substantially lessen competition or tend to create a monopoly.
The practical test is not ordinary contract reasonableness alone. Gagnon says a covenant can satisfy the Traeger reasonableness factors and still fail if it is not ancillary to a legitimate purpose under HRS chapter 480 .
That matters most for ordinary employee covenants. A restraint whose real purpose is to block new competition is not enough. The employer needs a protectable interest such as trade secrets, genuinely confidential information, special customer relationships, workforce stability for an employee-solicitation covenant, or specialized training combined with other protectable factors.
A Hawaii covenant that fits a familiar category is not automatically enforceable. Keep the record focused on the specific protected interest and on why the restraint is no broader than that interest requires.
Every restraint in a Hawaii agreement passes through HRS chapter 480's antitrust screen, not ordinary contract reasonableness alone: HRS 480-4(a) makes every in-state restraint of trade illegal, and 480-4(c) makes a covenant lawful only where it is ancillary to a legitimate purpose not violative of chapter 480 and its effect is not substantially to lessen competition or to tend to create a monopoly. A covenant that satisfies every reasonableness factor is still unenforceable unless it is ancillary to such a purpose, and preventing competition is not one, so a restraint whose real work is blocking ordinary competition fails no matter how tightly its duration and territory are drawn. The purpose has to be a recognized protectable interest — trade secrets, genuinely confidential information, special customer relationships, workforce stability for an employee-solicitation covenant, or specialized training combined with other protectable factors — proven for each covenant on its own record rather than assumed, and no particular form or timing of consideration substitutes for that showing; binding a non-compete to named competitors is one way to show it reaches a specific interest against specific rivals rather than the market at large .
Sources for this answer
Primary source · Primary law
A.1 HRS 480-4HRS 480-4 supports Hawaii's baseline antitrust rule that in-state restraints of trade or commerce are illegal.
Every contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce in the State, or in any section of this State is illegal.
See Haw. Rev. Stat. 480-4(a).
Primary source · Primary law
A.2 HRS 480-4HRS 480-4 supports the statutory framework allowing certain restrictive covenants only when ancillary to a legitimate chapter 480 purpose and not substantially anticompetitive.
Notwithstanding subsection (b) and without limiting the application of subsection (a), it shall be lawful for a person to enter into any of the following restrictive covenants or agreements ancillary to a legitimate purpose not violative of this chapter, unless the effect thereof may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State: (1) A covenant or agreement by the transferor of a business not to compete within a reasonable area and within a reasonable period of time in connection with the sale of the business; (2) A covenant or agreement between partners not to compete with the partnership within a reasonable area and for a reasonable period of time upon the withdrawal of a partner from the partnership; (3) A covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business or agricultural uses, or covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business uses and of the lessor to be restricted in the use of premises reasonably proximate to any such leased premises to certain business uses; (4) A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c).
Primary source · Case law · 2022-02-17
A.3 Prudential Locations, LLC v. GagnonGagnon supports the rule that a Hawaii restrictive covenant must be ancillary to a legitimate purpose under chapter 480 even if it otherwise satisfies reasonableness factors.
Even if a restrictive covenant otherwise satisfies the Traeger three-factor reasonableness test, it is unenforceable unless it is ancillary to a legitimate purpose not violative of Chapter 480.
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Case law · 2022-02-17
A.4 Prudential Locations, LLC v. GagnonGagnon supports the rule that preventing competition is not a legitimate ancillary purpose for a Hawaii non-compete.
Preventing competition, however, is not a legitimate ancillary purpose under HRS § 480-4(a).
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Case law · 2006-09-13
A.5 7's Enterprises, Inc. v. Del RosarioDel Rosario supports treating specialized training as a possible legitimate interest only when combined with other protectable business interests.
Hence, as a matter of law, we hold that training that provides skills beyond those of a general nature is a legitimate interest which may be considered in weighing the reasonableness of a non-competition covenant, when combined with other factors weighing in favor of a protectable business interest such as trade secrets, confidential information, or special customer relationships.
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
Primary source · Case law · 2006-09-13
A.6 7's Enterprises, Inc. v. Del RosarioDel Rosario, restating the Traeger rule, supports Hawaii's three-factor reasonableness test for restrictive covenants.
As observed in Traeger, courts will find a non-competition provision unreasonable if “ ‘(i) it is greater than required for the protection of the person for whose benefit it is imposed; (ii) it imposes undue hardship on the person restricted; or (iii) its benefit to the covenantee is outweighed by injury to the public.’ ”
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
What legitimate interests can support a Hawaii non-compete?
Trade secrets are expressly covered, and Hawaii cases also recognize a narrow set of non-statutory interests. HRS 480-4(c)(4) covers employee or agent covenants not to use employer trade secrets, while Gagnon and Del Rosario require a legitimate ancillary purpose beyond suppressing competition.
The statute lists several categories, each still subject to the same chapter 480 limits: business-sale covenants, partner-withdrawal covenants, lease-use covenants, and employee or agent covenants tied to trade-secret use.
Outside the text, Traeger says the statutory categories are not exclusive, but Gagnon adds the modern limiting rule: the covenant still must be ancillary to a legitimate purpose under chapter 480.
A confidentiality label pinned to ordinary market knowledge does not carry the covenant. In Gagnon the claimed confidential-interest theory failed where similarly situated workers were not restricted, the information was shared more broadly, and no trade-secret violation was shown, so a covenant resting on that kind of record is unenforceable rather than merely narrowed .
Sources for this answer
Primary source · Primary law
B.1 HRS 480-4HRS 480-4 supports the employee or agent trade-secret covenant exception.
A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(4).
Primary source · Case law · 2022-02-17
B.2 Prudential Locations, LLC v. GagnonGagnon supports the rule that preventing competition is not a legitimate ancillary purpose.
Preventing competition, however, is not a legitimate ancillary purpose under HRS § 480-4(a).
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Case law · 2006-09-13
B.3 7's Enterprises, Inc. v. Del RosarioDel Rosario supports specialized training as a possible protectable interest only when combined with other protectable factors.
Hence, as a matter of law, we hold that training that provides skills beyond those of a general nature is a legitimate interest which may be considered in weighing the reasonableness of a non-competition covenant, when combined with other factors weighing in favor of a protectable business interest such as trade secrets, confidential information, or special customer relationships.
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
Primary source · Primary law
B.4 HRS 480-4HRS 480-4 supports the sale-of-business covenant category.
Notwithstanding subsection (b) and without limiting the application of subsection (a), it shall be lawful for a person to enter into any of the following restrictive covenants or agreements ancillary to a legitimate purpose not violative of this chapter, unless the effect thereof may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State: (1) A covenant or agreement by the transferor of a business not to compete within a reasonable area and within a reasonable period of time in connection with the sale of the business; (2) A covenant or agreement between partners not to compete with the partnership within a reasonable area and for a reasonable period of time upon the withdrawal of a partner from the partnership; (3) A covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business or agricultural uses, or covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business uses and of the lessor to be restricted in the use of premises reasonably proximate to any such leased premises to certain business uses; (4) A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(1).
Primary source · Primary law
B.5 HRS 480-4HRS 480-4 supports the partner-withdrawal covenant category.
Notwithstanding subsection (b) and without limiting the application of subsection (a), it shall be lawful for a person to enter into any of the following restrictive covenants or agreements ancillary to a legitimate purpose not violative of this chapter, unless the effect thereof may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State: (1) A covenant or agreement by the transferor of a business not to compete within a reasonable area and within a reasonable period of time in connection with the sale of the business; (2) A covenant or agreement between partners not to compete with the partnership within a reasonable area and for a reasonable period of time upon the withdrawal of a partner from the partnership; (3) A covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business or agricultural uses, or covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business uses and of the lessor to be restricted in the use of premises reasonably proximate to any such leased premises to certain business uses; (4) A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(2).
Primary source · Primary law
B.6 HRS 480-4HRS 480-4 supports the lease-use restrictive covenant category.
Notwithstanding subsection (b) and without limiting the application of subsection (a), it shall be lawful for a person to enter into any of the following restrictive covenants or agreements ancillary to a legitimate purpose not violative of this chapter, unless the effect thereof may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State: (1) A covenant or agreement by the transferor of a business not to compete within a reasonable area and within a reasonable period of time in connection with the sale of the business; (2) A covenant or agreement between partners not to compete with the partnership within a reasonable area and for a reasonable period of time upon the withdrawal of a partner from the partnership; (3) A covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business or agricultural uses, or covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business uses and of the lessor to be restricted in the use of premises reasonably proximate to any such leased premises to certain business uses; (4) A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(3).
Primary source · Case law · 1976-06-17
B.7 Technicolor, Inc. v. TraegerTraeger supports the rule that HRS 480-4(c) categories are not exclusive.
Our understanding of the above committee report is that the restrictive covenants and agreements enumerated under § 480-4(c) were not meant to be exclusive in their respective fields.
See Technicolor, Inc. v. Traeger, 57 Haw. 113, 551 P.2d 163 (1976).
Primary source · Case law · 2022-02-17
B.8 Prudential Locations, LLC v. GagnonGagnon supports requiring a legitimate ancillary purpose even after reasonableness review.
Even if a restrictive covenant otherwise satisfies the Traeger three-factor reasonableness test, it is unenforceable unless it is ancillary to a legitimate purpose not violative of Chapter 480.
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Case law · 2022-02-17
B.9 Prudential Locations, LLC v. GagnonGagnon supports scrutinizing whether alleged confidential information is actually confidential and protected.
In addition, Locations did not produce any evidence of and did not dispute that there was no trade secret violation.
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Are sale-of-business non-competes enforceable in Hawaii?
Yes, if they are tied to the sale of a business and limited to a reasonable area and reasonable period. HRS 480-4(c)(1) expressly permits a transferor covenant in connection with a business sale, subject to the broader antitrust limit in HRS 480-4(c).
The sale context is stronger than an ordinary employment restraint because the buyer is usually protecting purchased goodwill. Still, the covenant must be reasonable. Traeger frames reasonableness around protection needed, hardship on the restricted party, public injury, geography, time, and breadth.
A Hawaii sale covenant is measured against the goodwill and competitive risk actually transferred. HRS 480-4(c)(1) permits the transferor restraint only within a reasonable area and a reasonable period, and Traeger holds the restraint to no more than the protection needed, so a sale covenant sized beyond the goodwill it protects is exposed as unreasonable.
Sources for this answer
Primary source · Primary law
C.1 HRS 480-4HRS 480-4 supports Hawaii's sale-of-business covenant exception.
Notwithstanding subsection (b) and without limiting the application of subsection (a), it shall be lawful for a person to enter into any of the following restrictive covenants or agreements ancillary to a legitimate purpose not violative of this chapter, unless the effect thereof may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State: (1) A covenant or agreement by the transferor of a business not to compete within a reasonable area and within a reasonable period of time in connection with the sale of the business; (2) A covenant or agreement between partners not to compete with the partnership within a reasonable area and for a reasonable period of time upon the withdrawal of a partner from the partnership; (3) A covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business or agricultural uses, or covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business uses and of the lessor to be restricted in the use of premises reasonably proximate to any such leased premises to certain business uses; (4) A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(1).
Primary source · Primary law
C.2 HRS 480-4HRS 480-4 supports the broader antitrust limitation on restrictive covenants.
Notwithstanding subsection (b) and without limiting the application of subsection (a), it shall be lawful for a person to enter into any of the following restrictive covenants or agreements ancillary to a legitimate purpose not violative of this chapter, unless the effect thereof may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State: (1) A covenant or agreement by the transferor of a business not to compete within a reasonable area and within a reasonable period of time in connection with the sale of the business; (2) A covenant or agreement between partners not to compete with the partnership within a reasonable area and for a reasonable period of time upon the withdrawal of a partner from the partnership; (3) A covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business or agricultural uses, or covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business uses and of the lessor to be restricted in the use of premises reasonably proximate to any such leased premises to certain business uses; (4) A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c).
Primary source · Case law · 2006-09-13
C.3 7's Enterprises, Inc. v. Del RosarioDel Rosario, restating the Traeger rule, supports Hawaii's three-factor reasonableness test for restrictive covenants.
As observed in Traeger, courts will find a non-competition provision unreasonable if “ ‘(i) it is greater than required for the protection of the person for whose benefit it is imposed; (ii) it imposes undue hardship on the person restricted; or (iii) its benefit to the covenantee is outweighed by injury to the public.’ ”
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
Primary source · Case law · 2006-09-13
C.4 7's Enterprises, Inc. v. Del RosarioDel Rosario, restating Traeger, supports examining geographical scope, duration, and breadth when assessing reasonableness.
A court “must examine such factors as geographical scope, length of time, and breadth of the restriction placed on a given activity.”
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
What special non-compete rule applies to Hawaii technology-business employees?
Hawaii has a specific technology-business ban. Except for trade-secret covenants under HRS 480-4(c)(4), HRS 480-4(d) prohibits noncompete and nonsolicit clauses in employment contracts for employees of a technology business and makes the clause void and of no force and effect .
The definition focuses on the business, not just the employee title. A technology business is a trade or business deriving a majority of gross income from products or services resulting from software development, information technology development, or both .
The same definition excludes the broadcast industry and certain telecommunications carriers. The statute separately defines noncompete and nonsolicit clauses for this subsection.
A broad employment noncompete or employee nonsolicit imposed on a Hawaii technology-business employee is void and of no force and effect, because HRS 480-4(d) preserves only the HRS 480-4(c)(4) trade-secret path for a covered employee. A restraint built around actual trade-secret use is the one that survives; anything reaching further falls with the statutory ban. Because coverage keys to the employer's line of business rather than the worker's title, a successor whose revenue mix makes it a technology business brings the same ban to a covenant it inherits.
Sources for this answer
Primary source · Primary law
D.1 HRS 480-4HRS 480-4 supports Hawaii's statutory ban on noncompete and nonsolicit clauses in employment contracts for technology-business employees, except for trade-secret covenants.
Except as provided in subsection (c)(4), it shall be prohibited to include a noncompete clause or a nonsolicit clause in any employment contract relating to an employee of a technology business. The clause shall be void and of no force and effect.
See Haw. Rev. Stat. 480-4(d).
Primary source · Primary law
D.2 HRS 480-4HRS 480-4 supports the definition of technology business and its broadcast and telecommunications exclusions.
“Technology business” means a trade or business that derives the majority of its gross income from the sale or license of products or services resulting from its software development or information technology development, or both. A “technology business” excludes any trade or business that is considered by standard practice as part of the broadcast industry or any telecommunications carrier, as defined in section 269-1, that holds a franchise or charter enacted or granted by the legislative or executive authority of the State or its predecessor governments.
See Haw. Rev. Stat. 480-4(d).
Primary source · Primary law
D.3 HRS 480-4HRS 480-4 supports the technology-business subsection's definition of noncompete clause.
“Noncompete clause” means a clause in an employment contract that prohibits an employee from working in a specific geographic area for a specific period of time after leaving employment with the employer.
See Haw. Rev. Stat. 480-4(d).
Primary source · Primary law
D.4 HRS 480-4HRS 480-4 supports the technology-business subsection's definition of nonsolicit clause.
“Nonsolicit clause” means a clause in an employment contract that prohibits an employee from soliciting employees of the employer after leaving employment with the employer.
See Haw. Rev. Stat. 480-4(d).
Primary source · Primary law
D.5 HRS 480-4HRS 480-4 supports preserving employee or agent trade-secret covenants.
A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(4).
Are customer or employee non-solicitation agreements enforceable in Hawaii?
Sometimes, but they are analyzed as restraints of trade and need a legitimate ancillary purpose. Gagnon held that solicitation clauses require a legitimate ancillary purpose under HRS 480-4(a), and that a solicitation violation requires active initiation of contact.
The active-solicitation rule is important. Telling coworkers that the employee is leaving, or passively accepting a decision to follow, does not automatically prove solicitation. The employer needs evidence that the restricted person actively initiated the contact that allegedly breached the clause.
For technology-business employees, the statutory rule is stricter. HRS 480-4(d) voids nonsolicit clauses in covered employment contracts except for the trade-secret carve-out in HRS 480-4(c)(4).
A Hawaii solicitation covenant written as no-contact, no-service, or no-acceptance language reaches conduct that falls outside solicitation: Gagnon frames solicitation around active initiation of contact, so a covenant sweeping in passive dealing is a broader restraint that still must clear the legitimate-ancillary-purpose screen of HRS 480-4 and is exposed where it does not.
Sources for this answer
Primary source · Case law · 2022-02-17
E.1 Prudential Locations, LLC v. GagnonGagnon supports the rule that solicitation clauses are restraints of trade requiring a legitimate ancillary purpose.
Solicitation clauses are also contracts in restraint of trade or commerce that require a legitimate ancillary purpose under HRS § 480-4(a).
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Case law · 2022-02-17
E.2 Prudential Locations, LLC v. GagnonGagnon supports the rule that solicitation requires active initiation of contact.
Our law does not clearly define “solicitation.” We agree with reasoned opinions from other jurisdictions and now hold that “solicitation” requires an active initiation of contact.
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Case law · 2022-02-17
E.3 Prudential Locations, LLC v. GagnonGagnon supports the rule that former coworkers joining a new venture does not automatically prove solicitation.
These agents’ termination of their employment with Locations and subsequent employment with Prestige do not automatically demonstrate a violation of the non-solicitation clause.
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Primary law
E.4 HRS 480-4HRS 480-4 supports the statutory ban on nonsolicit clauses for covered technology-business employees, except for trade-secret covenants.
Except as provided in subsection (c)(4), it shall be prohibited to include a noncompete clause or a nonsolicit clause in any employment contract relating to an employee of a technology business. The clause shall be void and of no force and effect.
See Haw. Rev. Stat. 480-4(d).
Primary source · Primary law
E.5 HRS 480-4HRS 480-4 supports preserving employee or agent trade-secret covenants.
A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(4).
What remedies or consequences can follow an unlawful Hawaii non-compete?
Hawaii chapter 480 has private remedies. A person injured in business or property by conduct forbidden by the chapter may sue for damages, may seek an injunction, and, if the judgment or decree is for the plaintiff, receives reasonable attorney fees and costs .
For damages claims under HRS 480-13(a), the award is at least $1,000 or threefold damages, whichever is greater, plus reasonable attorney fees and costs for a prevailing plaintiff. For injunction proceedings, a plaintiff who obtains the decree is also awarded reasonable attorney fees and costs .
The fee rule is therefore plaintiff-focused, not a general loser-pays rule. In a non-compete dispute, the party suing under chapter 480 must still show injury to business or property by something forbidden or declared unlawful by the chapter .
HRS 480-2 can also matter because it separately declares unfair methods of competition unlawful and allows any person to bring an action based on that theory.
Because the covenants in a Hawaii agreement are themselves analyzed as restraints of trade under chapter 480, a covenant that fails the HRS 480-4 framework is not merely unenforceable but a potential source of chapter 480 liability for the party pressing it. HRS 480-13(a) lets a person injured in business or property by anything the chapter forbids recover the greater of $1,000 or threefold damages plus reasonable attorney fees and costs on a plaintiff's judgment, and fees and costs again on a plaintiff's injunction decree — a plaintiff-focused, one-way regime the parties cannot draft around, and one that applies regardless of any contractual fee provision. HRS 480-2 separately declares unfair methods of competition unlawful and lets any person sue on that theory, so warning a future employer off an employee on the strength of a covenant that fails the restraint-of-trade screen carries its own exposure.
Sources for this answer
Primary source · Primary law
F.1 HRS 480-13HRS 480-13 supports private damages, treble or statutory-minimum recovery, injunctive proceedings, and fee-and-cost awards for a prevailing plaintiff injured by conduct forbidden by chapter 480.
Except as provided in subsections (b) and (c), any person who is injured in the person's business or property by reason of anything forbidden or declared unlawful by this chapter: (1) May sue for damages sustained by the person, and, if the judgment is for the plaintiff, the plaintiff shall be awarded a sum not less than $1,000 or threefold damages by the plaintiff sustained, whichever sum is the greater, and reasonable attorney's fees together with the costs of suit; provided that indirect purchasers injured by an illegal overcharge shall recover only compensatory damages, and reasonable attorney's fees together with the costs of suit in actions not brought under section 480-14(c); and (2) May bring proceedings to enjoin the unlawful practices, and if the decree is for the plaintiff, the plaintiff shall be awarded reasonable attorney's fees together with the costs of suit.
See Haw. Rev. Stat. 480-13(a).
Primary source · Primary law
F.2 HRS 480-13HRS 480-13 supports injunction proceedings and fee-and-cost awards for a prevailing plaintiff.
Except as provided in subsections (b) and (c), any person who is injured in the person's business or property by reason of anything forbidden or declared unlawful by this chapter: (1) May sue for damages sustained by the person, and, if the judgment is for the plaintiff, the plaintiff shall be awarded a sum not less than $1,000 or threefold damages by the plaintiff sustained, whichever sum is the greater, and reasonable attorney's fees together with the costs of suit; provided that indirect purchasers injured by an illegal overcharge shall recover only compensatory damages, and reasonable attorney's fees together with the costs of suit in actions not brought under section 480-14(c); and (2) May bring proceedings to enjoin the unlawful practices, and if the decree is for the plaintiff, the plaintiff shall be awarded reasonable attorney's fees together with the costs of suit.
See Haw. Rev. Stat. 480-13(a)(2).
Primary source · Primary law
F.3 HRS 480-2HRS 480-2 supports Hawaii's separate prohibition on unfair methods of competition and unfair or deceptive acts or practices.
Unfair methods of competition and unfair or deceptive acts or practices in the conduct of any trade or commerce are unlawful.
See Haw. Rev. Stat. 480-2(a).
Primary source · Primary law
F.4 HRS 480-2HRS 480-2 supports private actions by any person for unfair methods of competition.
Any person may bring an action based on unfair methods of competition declared unlawful by this section.
See Haw. Rev. Stat. 480-2(e).
Are trade-secret, confidentiality, and NDA alternatives available in Hawaii?
Yes. HRS 480-4(c)(4) expressly allows an employee or agent covenant not to use trade secrets in competition for the time reasonably necessary to protect the employer or principal, without undue hardship on the employee or agent .
Hawaii's trade-secret statute also preserves contractual remedies. HRS 482B-8 displaces conflicting tort, restitutionary, and other civil remedies for trade-secret misappropriation, but it does not affect contractual remedies, other non-misappropriation civil remedies, or criminal remedies.
The drafting point is to protect information rather than work. A confidentiality or NDA covenant is safer when it targets actual trade secrets or confidential information and avoids operating as a practical ban on ordinary employment competition.
An NDA drafted to do non-compete work does not hold up as one. Hawaii preserves trade-secret and contract remedies, but Gagnon rejected a confidentiality theory where the record showed no real protected information and no trade-secret violation, so a confidentiality covenant that operates as a practical ban on ordinary competition falls back into the HRS 480-4(a) antitrust baseline rather than standing as trade-secret protection.
Sources for this answer
Primary source · Primary law
G.1 HRS 480-4HRS 480-4 supports employee or agent covenants that restrict use of employer or principal trade secrets in competition.
A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c)(4).
Primary source · Primary law
G.2 HRS 482B-8HRS 482B-8 supports Hawaii UTSA displacement of conflicting civil remedies for trade-secret misappropriation.
Except as provided in subsection (b) this chapter displaces conflicting tort, restitutionary, and other law of this State providing civil remedies for misappropriation of a trade secret.
See Haw. Rev. Stat. 482B-8(a).
Primary source · Primary law
G.3 HRS 482B-8HRS 482B-8 supports preserving contractual remedies whether or not based on trade-secret misappropriation.
This chapter does not affect: (1) Contractual remedies, whether or not based upon misappropriation of a trade secret; (2) Other civil remedies that are not based upon misappropriation of a trade secret; or (3) Criminal remedies, whether or not based upon misappropriation of a trade secret.
See Haw. Rev. Stat. 482B-8(b).
Primary source · Case law · 2022-02-17
G.4 Prudential Locations, LLC v. GagnonGagnon supports requiring evidence that claimed confidential information is actually protected.
In addition, Locations did not produce any evidence of and did not dispute that there was no trade secret violation.
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Does a Hawaii non-compete period toll during breach or litigation?
Open question. The staged Hawaii authorities do not squarely resolve whether a covenant period pauses while the former employee is allegedly breaching or while enforcement litigation is pending, so a tolling clause should be analyzed as part of the effective duration of the restraint under HRS 480-4(c) and Traeger.
The reason is practical. A contractual extension-on-breach clause lengthens the actual restraint. Hawaii's framework asks whether the covenant is ancillary to a legitimate purpose, whether its effect may substantially lessen competition, and whether its geography, time, and breadth are reasonable.
A tolling or extension-on-breach clause is untested in the staged Hawaii sources, so its enforcement cannot be assumed. Because such a clause extends the effective restricted period, it is measured under the same HRS 480-4 antitrust and reasonableness limits that govern the covenant itself, and an extension pushing the covenant past a reasonable duration is exposed on the same ground the underlying restraint would be.
Sources for this answer
Primary source · Primary law
H.1 HRS 480-4HRS 480-4 supports applying Hawaii's ancillary-purpose and anticompetitive-effect framework to the effective length of a restrictive covenant.
Notwithstanding subsection (b) and without limiting the application of subsection (a), it shall be lawful for a person to enter into any of the following restrictive covenants or agreements ancillary to a legitimate purpose not violative of this chapter, unless the effect thereof may be substantially to lessen competition or to tend to create a monopoly in any line of commerce in any section of the State: (1) A covenant or agreement by the transferor of a business not to compete within a reasonable area and within a reasonable period of time in connection with the sale of the business; (2) A covenant or agreement between partners not to compete with the partnership within a reasonable area and for a reasonable period of time upon the withdrawal of a partner from the partnership; (3) A covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business or agricultural uses, or covenant or agreement of the lessee to be restricted in the use of the leased premises to certain business uses and of the lessor to be restricted in the use of premises reasonably proximate to any such leased premises to certain business uses; (4) A covenant or agreement by an employee or agent not to use the trade secrets of the employer or principal in competition with the employee's or agent's employer or principal, during the term of the agency or thereafter, or after the termination of employment, within such time as may be reasonably necessary for the protection of the employer or principal, without imposing undue hardship on the employee or agent.
See Haw. Rev. Stat. 480-4(c).
Primary source · Case law · 2006-09-13
H.2 7's Enterprises, Inc. v. Del RosarioDel Rosario, restating Traeger, supports examining geographical scope, duration, and breadth as part of restrictive-covenant reasonableness.
A court “must examine such factors as geographical scope, length of time, and breadth of the restriction placed on a given activity.”
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
Primary source · Case law · 2006-09-13
H.3 7's Enterprises, Inc. v. Del RosarioDel Rosario, restating the Traeger rule, supports Hawaii's three-factor reasonableness test for restrictive covenants.
As observed in Traeger, courts will find a non-competition provision unreasonable if “ ‘(i) it is greater than required for the protection of the person for whose benefit it is imposed; (ii) it imposes undue hardship on the person restricted; or (iii) its benefit to the covenantee is outweighed by injury to the public.’ ”
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
Will Hawaii courts narrow or reform an overbroad non-compete?
Do not rely on it as a drafting strategy. The staged Hawaii sources support judicial reasonableness review and case-specific limits on injunctions, but they do not supply a broad rule that courts will rewrite any overbroad employee non-compete into an enforceable one.
Del Rosario is the best example in the staged sources of a court correcting the enforced scope. The trial court had enjoined work as a briefer statewide, but the covenant itself was limited to the County of Honolulu, and the appellate court remanded to amend the judgment to that county limit .
That is not the same as permission to draft broadly. Gagnon refused enforcement of a non-compete that lacked a legitimate ancillary purpose, even though the employer argued confidentiality and competition concerns. For a clause-by-clause pass over a specific agreement against these drafting rules, the Hawaii non-compete reviewer checklist walks the full covenant suite item by item with each requirement's force level.
A Hawaii restriction stands on the minimum scope its protected interest supports, not on the expectation that a court will rescue an overbroad one. A court may trim an injunction to the contract and record before it, but Gagnon shows that a covenant lacking a legitimate ancillary purpose fails outright rather than being saved by narrower wording, so scope drawn beyond the interest is exposed rather than reformed.
Sources for this answer
Primary source · Case law · 1976-06-17
I.1 Technicolor, Inc. v. TraegerTraeger supports Hawaii's reasonableness analysis for restrictive covenants.
This “reasonableness analysis” is done by the court, as a matter of law, and not as appellant contends, by a jury, as a matter of fact.
See Technicolor, Inc. v. Traeger, 57 Haw. 113, 551 P.2d 163 (1976).
Primary source · Case law · 2006-09-13
I.2 7's Enterprises, Inc. v. Del RosarioDel Rosario supports limiting the injunction to the County of Honolulu where the covenant itself had that geographic limit.
The case is remanded to the court to amend its judgment to reflect that the injunction involved herein is limited to the County of Honolulu.
See 7's Enterprises, Inc. v. Del Rosario, 111 Haw. 484, 143 P.3d 23 (2006).
Primary source · Case law · 2022-02-17
I.3 Prudential Locations, LLC v. GagnonGagnon supports the rule that lack of a legitimate ancillary purpose makes a covenant unenforceable.
Even if a restrictive covenant otherwise satisfies the Traeger three-factor reasonableness test, it is unenforceable unless it is ancillary to a legitimate purpose not violative of Chapter 480.
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).
Primary source · Case law · 2022-02-17
I.4 Prudential Locations, LLC v. GagnonGagnon supports the rule that preventing competition is not a legitimate ancillary purpose.
Preventing competition, however, is not a legitimate ancillary purpose under HRS § 480-4(a).
See Prudential Locations, LLC v. Gagnon, 151 Haw. 136, 509 P.3d 1099 (2022).