UK non-compete reform: good news for sales leaders.

One UK company spent more than £600,000 in legal fees trying to hold one salesperson to a 12-month non-compete. That's according to the salesperson's own solicitor. The company lost.

The rules behind that fight are about to change. As of 3 November 2026, non-compete clauses are still legal in the UK. But on 9 October, Prime Minister Andy Burnham said the government will legislate to limit them. He called it a Bosman ruling for the innovation sector, after the court case that let footballers move clubs freely when their contracts ran out. The Budget on 28 October confirmed the plan, and the detail is due in early 2027.

I've spent twenty years in sales, from SDR to CRO. Before meritt, I ran SaaSLeads, an SDR academy that placed more than 400 people into sales jobs. My read: this is good news for sales leaders who build teams people want to join.

Here's what's been announced, what it means for hiring and keeping reps, and the five things I'd do now.

What has the government announced?

Nothing has changed yet. Here's how we got here.

Three things stand out to me:

• There's no ban yet. The government hasn't picked an option. The options in its paper include an outright ban, a cap on length and a ban below a salary threshold.
• It needs a new law. Lawyers expect primary legislation, so a bill has to pass through Parliament first. There isn't one yet.
• Today's clauses still count. A court will still enforce a non-compete that goes no further than needed to protect a legitimate business interest. The employer has to prove that.

One detail matters more in sales than in most jobs. If the government uses a salary threshold, will it count base salary or OTE? Its paper doesn't say. The example thresholds in it run from about £85,000 to £125,140. A mid-market AE in London earns £65,000 to £80,000 base and £115,000 to £135,000 OTE, according to our London SDR and AE pay guide. Count base, and those AEs sit under every example. Count OTE, and they clear most of them.

Most employers will wait for the detail. That gives you a head start.

Why is this good news for sales leaders?

A lot of good reps are stuck where they are.

• The government estimates that around 5 million employees in Great Britain have a non-compete. The typical one lasts about six months.
• The CMA found them in more than 40% of contracts for people earning £100,000 or more, and 20 to 30% of contracts below that. That's where many of your senior AEs sit.
• The government's own paper says many workers stick to their clause because they fear the legal consequences, or can't afford to challenge it.

So some of the reps you'd most like to hire think they can't move. Reform puts them back in play.

You need them, too. The Bridge Group, a US research firm, found companies now want 3.7 years of experience before they hire an AE, up from 2.7 in 2022. And in US data, fewer SDRs are moving up into AE roles. I covered that in UK sales hiring 2026.

How do you keep top reps without a non-compete?

Give them reasons to stay that a rival can't match with one offer letter. Fair pay and bonus come first. Then real coaching, flexibility and a clear path to promotion. The government's own paper says that if non-competes were banned, employers might keep people with better pay, bonuses and flexibility instead.

It's worth the effort, because losing an AE is expensive. The Bridge Group puts AE ramp at 6.2 months and the median AE quota at $960,000. So when an AE leaves, about $496,000 of that year's number sits with someone still learning the job. That's our maths, from their figures.

And it's a hard number to hit anyway. Only 42.3% of UK AEs hit quota in the last year (RepVue).

What should sales leaders do now?

Here are the five things I'd do.

1. List the reps you'd hire tomorrow. Name the top sellers at your three closest competitors and start talking to them now. Check each contract before you make an offer, because current clauses still apply.
2. Check your own contracts. Keep a non-compete only where you can show why that role needs one. In Tom James v Potter, the judge criticised a one-size-fits-all 12-month clause with no evidence behind it. In June 2026, the High Court threw out a six-month non-compete for an area sales manager who joined a rival, because it was too wide (Huws Gray v Gentleman).
3. Protect your accounts. Courts ask whether a narrower clause, like a client non-solicit, would have done the job. In Tom James, the company's own witnesses conceded the non-compete added little. Lewis Silkin suggests non-solicit, non-dealing and team-move clauses, plus a review of garden leave and notice periods, which it says may also be targeted.
4. Give your reps reasons to stay. Pay and bonus first. Then coaching and a clear path to promotion.
5. Hire on behaviours. A rep from a competitor knows the market. That doesn't tell you how they'll sell for you, which is why I'd stop hiring for product knowledge. At meritt we assess curiosity, coachability, communication and grit. You can teach the craft of selling, but only to people who have those behaviours underneath it.

For step three, here's what each clause does:

Can you use a US non-compete for a UK sales hire?

Not safely. English courts test whether a restriction is reasonable, whatever the contract says, and the employer has to prove it.

In Tom James, the company's witness said 24 months was the norm in the US, and the business had moved everyone onto one length of clause. The judge found 12 months wasn't justified for a UK salesperson.

A foreign governing-law clause won't reliably save you either. English courts won't enforce restrictions in foreign-law incentive plans that fail under English law.

So use a UK contract from day one, and get local employment advice. The upside is real. Fewer restrictions should make it easier to hire experienced reps from established players and build your first UK team faster.

Common questions

This is general information, not legal advice. Check your own contracts with an employment lawyer.

Sources

• GOV.UK, working paper on options for reform of non-compete clauses, 26 November 2025, updated 19 February 2026. The options, the 5 million estimate, the CMA contract data, why workers comply, and how employers might respond to a ban.
• GOV.UK, the Prime Minister's speech at the Innovation Nation Summit, 9 October 2026.
• GOV.UK, Budget 2026, 28 October 2026. Whole-economy scope and the early 2027 timetable.
• GOV.UK, CMA response to the working paper, 25 February 2026.
• GOV.UK, the 2023 government response on non-compete clauses, 12 May 2023. The three-month cap.
• Gibson Dunn and Lewis Silkin, 9 October 2026. The announcement, primary legislation and alternative protections.
• Linklaters, 12 October 2026. What is still open.
• The Employment Law Solicitors, 10 October 2026. Open questions on existing contracts.
• [Tom James UK Ltd v Potter 2025] EWHC 2873 (KB), judgment of 4 November 2025, and DAC Beachcroft's summary, 4 December 2025.
• [Huws Gray Ltd v Gentleman 2026] EWHC 1309 (Comm), judgment of 17 June 2026.
• Solicitors Journal, 27 January 2026. The £600,000 legal bill, written by the salesperson's solicitor.
• The Bridge Group, 2026 AE research, June 2026. Experience at hire, ramp time and median quota. 158 B2B companies, reported in dollars.
• Data source: RepVue. UK AE quota attainment, October 2026. Self-reported.
• Penningtons Manches Cooper, 14 November 2022. Foreign governing law.