Alabama Employment Law — full calculator

Frequently Asked Questions

• Are non-compete agreements enforceable in Alabama?

  Yes. Under Alabama's Restrictive Covenant Act (Ala. Code § 8-1-190, effective January 1, 2016), non-compete agreements are enforceable when they protect a legitimate business interest — such as trade secrets, confidential business information, substantial customer relationships, or an employer's investment in specialized training — and are reasonable in duration and geographic scope. Agreements of two years or less are presumed reasonable as of 2026.

• How long can a non-compete agreement last in Alabama?

  Under Ala. Code § 8-1-190, agreements of two years (24 months) or less are presumed reasonable. Agreements longer than five years (60 months) are presumed unreasonable. The two-to-five-year range is a neutral zone requiring case-by-case court scrutiny. For a restrictive covenant tied to the sale of a business, one year is separately presumed reasonable.

• Can an Alabama court reduce an overly broad non-compete instead of voiding it?

  Yes. Alabama courts are required to reform (blue-pencil) an over-broad non-compete agreement to make it enforceable rather than declaring it void. This mandatory reformation rule under § 8-1-193 is a key difference from states that apply an 'all-or-nothing' standard and void over-broad agreements entirely.

• What qualifies as a legitimate business interest under Alabama's non-compete law?

  Alabama's Restrictive Covenant Act recognizes four main protectable interests: (1) trade secrets and confidential business information that has been properly protected by the employer; (2) substantial relationships with specific existing or prospective customers; (3) specialized training that involved substantial employer expenditure; and (4) business goodwill. General job skills or knowledge gained on the job alone are not a protectable interest under § 8-1-190.

• Does a non-compete need to be in writing to be enforceable in Alabama?

  Yes. Under Alabama's Restrictive Covenant Act, restrictive covenants must be set out in a written agreement signed by the employee to be enforceable. A verbal non-compete agreement is not enforceable under the statute.

• Does Alabama have a minimum wage higher than the federal rate?

  No. Alabama does not have a state minimum wage law. The federal minimum wage of $7.25 per hour applies to covered employees in Alabama as of 2026. Alabama also enacted a preemption law (SB 3, 2016) that prevents cities and counties from setting their own higher local minimum wages.

• Does Alabama require daily overtime pay or 7th-day overtime rules?

  No. Alabama has no state overtime law of its own. Employers follow the federal FLSA standard: time-and-a-half (1.5×) for non-exempt employees who work more than 40 hours in a workweek. There is no daily overtime threshold, 7th-day premium, or double-time requirement as exists in some other states.

• When must an Alabama employer issue a final paycheck?

  Alabama has no specific state statute setting a deadline for final paychecks after termination or resignation. The federal FLSA requires payment by the employee's next regular scheduled payday. Because Alabama has no separate state final paycheck law, there is no state-level penalty for late payment — only potential federal wage claims.

• Are Alabama employers required to provide meal or rest breaks?

  No. Alabama does not mandate meal or rest breaks for adult employees, and the federal FLSA does not require them either. Employers who voluntarily provide short rest breaks of 20 minutes or less must pay for that time under federal rules, but there is no Alabama law compelling employers to offer any break period.

• Is there a paid sick leave law in Alabama?

  No. Alabama has no state or local paid sick leave mandate as of 2026. Employers in Alabama may offer or withhold paid sick leave entirely at their discretion. There is also no Alabama unpaid sick leave law separate from federal FMLA protections for eligible workers.