The clause itself isn't the problem — a reasonable non-compete rarely stops you from earning a living. The problem is that "non-compete" covers everything from "don't work for this client's direct competitor for six months" to "don't do this kind of consulting for anyone, anywhere, for two years," and both versions get handed to consultants under the same one-line label. This isn't legal advice — talk to a lawyer before signing anything you're unsure about — but here's how to tell which version you're looking at before you agree to it.
What makes a non-compete reasonable
A non-compete that's worth accepting is narrow on three axes at once: who it restricts you from, what it restricts you from doing, and how long it lasts. Miss on any one axis and the clause starts working against you instead of just protecting the client's legitimate interest.
- Named competitors, not an industry."You may not consult for [Competitor A] or [Competitor B] for six months" is reasonable — it protects one specific relationship. "You may not provide consulting services in the [industry] sector" is not — it's a ban on your entire practice, worded to sound like a narrower restriction than it is.
- The specific service you delivered, not your whole skill set.If you were hired to build a pricing model, a reasonable clause blocks you from building the same pricing model for a direct competitor. It shouldn't block you from doing unrelated work — brand strategy, ops consulting, whatever else you offer — for that same company.
- Three to twelve months, not indefinite. Six months is typical for a project engagement; up to a year is defensible for a deep, ongoing retainer where you built lasting institutional knowledge. Anything with no end date, or anything measured in years, is asking you to absorb a career-length cost for a project that lasted a few months.
What makes one overreaching
The tell is usually breadth dressed up as boilerplate. A clause that names "any business engaged in similar activities" instead of specific competitors isn't protecting a relationship — it's trying to remove you from the market. If signing would mean you couldn't take your next client without a lawyer reading every new contract against this one, that's the signal to push back, not sign and hope it never comes up.
Reasonable:"For 6 months following the end of this engagement, Consultant will not provide financial modeling services to [Client A] or [Client B], the two companies named in Schedule A."
Overreaching:"For 2 years following the end of this engagement, Consultant will not provide consulting services, in any capacity, to any company in the financial services industry." The second version doesn't protect a relationship — it removes an entire industry from your client list for two years, over a single project.
If you get the overreaching version, you have three moves: ask to narrow it to named competitors, ask to shorten the term, or ask to cut it entirely in exchange for a stronger confidentiality clause instead — which is usually what the client actually needs and what you should offer if a non-compete gets proposed by default.
What a confidentiality clause should cover
Confidentiality is the clause almost every client actually needs, and it's far less controversial to accept because it doesn't restrict your future work — it just restricts what you say about this one. A solid clause names what counts as confidential (financials, strategy documents, customer data, anything marked confidential or reasonably understood to be), how long the obligation lasts after the engagement ends (one to three years is standard, or indefinitely for trade secrets specifically), and a short list of carve-outs: information that was already public, information you already knew before the engagement, and information you're legally required to disclose.
What it shouldn't cover
Watch for a confidentiality clause that quietly does a non-compete's job. Some contracts define "confidential information" broadly enough to include your general methodology or frameworks — the ones you built before this client and use with every client. If accepted as written, that language can be read to mean you can't reuse your own approach anywhere else, which isn't confidentiality, it's a disguised restriction on your practice. The fix is a one-line carve-out: confidential information doesn't include your pre-existing methods, tools, or general know-how, only the client's specific data and materials.
None of this requires a lawyer to spot — it requires reading past the clause's label to what it actually restricts before you sign. The free Retainer Agreement Generatorbuilds in a standard confidentiality clause by default and leaves the non-compete out, so you're not starting from a template that hands you a restriction you never asked for.