Employer of Record · North Dakota
North Dakota has two compliance surprises that catch most out-of-state employers off guard. First, it is a monopolistic workers' comp state - all employers must purchase coverage through the state's Workforce Safety & Insurance fund, and private carriers are not an option. Second, North Dakota's restraint of trade statute makes employee non-compete agreements generally void, with exceptions only for the sale of a business or dissolution of a partnership. On the tax side, a 2023 overhaul slashed income tax rates to near zero, with a top rate of just 2.5%. Fargo, Bismarck, and Grand Forks are stable markets with significant healthcare, energy, and agricultural sector employers. WorkGenius becomes your legal employer and manages every North Dakota obligation from day one.
Facts reviewed against primary sources in September 2026
| Requirement | North Dakota | Detail |
|---|---|---|
| Minimum wage | $7.25/hr | North Dakota has not enacted a minimum wage above the federal floor |
| State income tax | 0% – 2.50% | Three brackets at 0%, 1.95% and 2.50%. Thresholds are indexed for inflation every year - for 2025, single filers paid 0% up to $48,475, 1.95% to $244,825 and 2.50% above |
| Workers' compensation | WSI state fund (monopolistic) | North Dakota employers must purchase from the state Workforce Safety & Insurance fund - private carriers are not permitted |
| Non-compete agreements | Generally void | NDCC §9-08-06 voids restraint of trade contracts; narrow exceptions only for business sale or partnership dissolution |
| Final paycheck | Next regular payday | NDCC 34-14-03: on a discharge, wages are due by the next regular payday or within 15 days, whichever is sooner; an employee who resigns is paid on the next regular payday |
| Human Rights Act | All employers | North Dakota's anti-discrimination statute covers all employers in the state |
The Defining Law
North Dakota Century Code §9-08-06 provides that "every contract by which anyone is restrained from exercising a lawful profession, trade, or business of any kind is to that extent void." The only statutory exceptions are for agreements made in connection with the sale of a business's goodwill and for dissolution of a partnership. Employee non-compete agreements - the kind that restrict where an employee can work after leaving - fall outside these exceptions and are generally unenforceable in North Dakota. This places North Dakota alongside California and Oklahoma as states that have broadly rejected employee non-competes, and contrasts sharply with states like Alabama, which presumes them valid. For employers accustomed to protecting customer relationships and trade secrets through non-competes, North Dakota requires a different approach: well-crafted NDAs, confidentiality provisions, and non-solicitation agreements focused on specific customer relationships are the reliable tools in this jurisdiction.
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North Dakota Coverage
North Dakota's monopolistic workers' comp requirement, void employee non-competes, and near-zero income tax create a distinct compliance profile that differs significantly from most other states.
WorkGenius enrolls every North Dakota employee with the state's Workforce Safety & Insurance (WSI) fund, manages all contribution payments by industry classification, and handles claims administration through the WSI system. Private carrier alternatives are not available.
WorkGenius reviews all restrictive covenants for North Dakota employees and restructures agreements to rely on enforceable tools - NDAs, confidentiality provisions, and narrowly scoped non-solicitation agreements - rather than void non-competes.
North Dakota's Human Rights Act covers all employers and prohibits discrimination based on race, color, religion, sex, national origin, age, disability, and other protected characteristics. WorkGenius ensures all employment agreements and onboarding materials are compliant.
North Dakota's 2023 tax overhaul created a near-zero income tax structure. WorkGenius applies the correct withholding across North Dakota's three-bracket system (0%, 1.95%, 2.50%) for every pay cycle.
North Dakota requires wages to be paid at least monthly. WorkGenius manages pay frequency, delivers final pay on the next regular payday, and maintains required wage records.
ACA-compliant health coverage, 401(k), and disability insurance enrolled and administered. Offboarding includes final pay on the next regular payday and COBRA administration.
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North Dakota is a monopolistic workers' comp state - employers must purchase coverage from the state's Workforce Safety & Insurance fund, not private carriers. Employee non-compete agreements are generally void under North Dakota's restraint of trade statute. A 2023 income tax overhaul means most North Dakotans now owe 0%–2.5% in state income tax. WorkGenius handles WSI enrollment, payroll, and compliance automatically.
North Dakota's monopolistic workers' comp fund and void non-compete statute are the two compliance elements that most surprise out-of-state employers.
North Dakota is one of four monopolistic workers' comp states (along with Ohio, Washington, and Wyoming). All employers must purchase coverage from the state's Workforce Safety & Insurance fund. Employers that attempt to self-insure or use private carriers are non-compliant. WSI sets rates by industry classification.
Employee non-competes are generally void under North Dakota's restraint of trade statute. The only exceptions are agreements tied to the sale of a business or dissolution of a partnership. NDAs, confidentiality agreements, and narrowly scoped non-solicitation clauses remain available and enforceable.
2023 legislation restructured North Dakota's income tax into three brackets at 0%, 1.95% and 2.50%, with the thresholds indexed for inflation each year. For 2025, single filers paid 0% up to $48,475, 1.95% to $244,825 and 2.50% above that. With the 0% bracket reaching roughly $48,000 of taxable income for a single filer, a large share of North Dakota workers owe no state income tax. This is among the lowest effective state income tax burdens in the US.
Covers all employers in North Dakota. Prohibits discrimination based on race, color, religion, sex, national origin, age, physical or mental disability, status with regard to marriage or public assistance, and participation in lawful activity off employer premises. The ND Department of Labor and Human Rights handles complaints.
Simple Process
Once the offer is signed, your new hire is set up and payroll-ready within 24 hours.
Workers, roles, locations, and start dates. We tailor the setup to your needs.
Our AI runs every worker through North Dakota's classification and compliance rules. We prepare compliant contracts and payroll setup.
Onboarded with North Dakota-compliant contracts, benefits enrolled, payroll running from day one.
Payroll runs on North Dakota rules. Taxes filed. Compliance monitored. One weekly invoice.
North Dakota has operated a state-run workers' compensation fund since 1919 - one of the earliest state funds in the US. Under the monopolistic model, all employers must purchase coverage from Workforce Safety & Insurance (WSI). Private insurance carriers are not permitted to write workers' comp policies for North Dakota employees. The rationale is that a single state fund provides uniform coverage and prevents adverse selection. Employers that operate without WSI coverage face significant penalties and personal liability for any workplace injury claims. WorkGenius handles all WSI enrollment and contribution payments for every North Dakota employee.
NDCC §9-08-06 has been in North Dakota law since the late 1800s, reflecting a longstanding legislative judgment that restraints on an individual's ability to work are against public policy. The statute broadly voids any contract "by which anyone is restrained from exercising a lawful profession, trade, or business of any kind." The only exceptions are for agreements made in connection with the sale of a business's goodwill (protecting the buyer's investment) and dissolution of a partnership - not employee post-employment restrictions. Courts have consistently held that employee non-competes are unenforceable even if the agreement specifies another state's law governs, when the employee actually works in North Dakota.
Non-disclosure agreements (NDAs) and confidentiality agreements protecting trade secrets and proprietary information are enforceable in North Dakota. Narrowly scoped non-solicitation agreements - prohibiting the solicitation of specific customers the employee had direct contact with - may also be enforceable when they do not operate as a general restraint on working in the industry. The key distinction is between protecting specific confidential information and relationships (permissible) versus broadly preventing an employee from working for a competitor (impermissible). WorkGenius structures North Dakota employment agreements with enforceable confidentiality and non-solicitation provisions.
North Dakota overhauled its income tax in 2023, creating a significantly simplified and reduced structure of three brackets at 0%, 1.95% and 2.50%. The rates have held since, but the thresholds are indexed for inflation every year, so they move each January: for 2025, single filers paid 0% up to $48,475, 1.95% from there to $244,825, and 2.50% above that. The majority of North Dakota workers - particularly those in lower and middle income brackets - owe zero state income tax. WorkGenius applies the correct withholding across all three brackets.
No. North Dakota has no state-mandated paid sick leave or paid family leave program. Federal FMLA provides unpaid job-protected leave for qualifying employees at employers with 50 or more employees. North Dakota is employer-friendly on leave compliance - no state accrual mandates, no leave insurance contributions, no paid leave administration requirements.
North Dakota's Human Rights Act covers all employers - there is no minimum headcount threshold. It prohibits discrimination in employment based on race, color, religion, sex, national origin, age, physical or mental disability, status with regard to marriage or public assistance, and participation in lawful activity off employer premises outside work hours. The North Dakota Department of Labor and Human Rights handles administrative complaints.
WorkGenius handles worker classification, North Dakota payroll, benefits, and every other compliance requirement so you don't have to. Get started today.
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