Trade Secrets & Non-Compete Law

March 8, 2024July 26, 2024 by Duane Morris

It’s No Competition: New York City Legislature Proposes Sweeping Non-Compete Bills

On February 28, 2024, the New York City Council introduced a trio of legislative proposals aimed to drastically limit the ability of New York City employers to enter into or enforce non-compete agreements with their workers.

The most sweeping of the bills, Int. 0140-2024, is aptly titled “Prohibition of non-compete agreements.” If passed, the legislation would entirely prohibit businesses in New York City from entering into, or even maintaining, non-compete agreements with any of their workers. All employers would be covered by the bill, as the proposed law defines “employer” to mean “a person that hires or contracts with a worker to work for a person.” The far-reaching bill seeks to apply a prohibition on non-compete agreements to all individuals who work for an employer, whether paid or unpaid, and includes employees as well as independent contractors.

Read the full Alert on the Duane Morris LLP website.

January 2, 2024July 26, 2024 by Duane Morris

Legislation Prohibiting Noncompete Agreements Vetoed by New York Governor

On December 22, 2023, Governor Kathy Hochul vetoed a bill that would have prohibited almost all noncompete agreements in employment contracts in New York. The bill, passed by the New York Legislature in June (see our previous Alert), would have applied to all employers and most individuals, including independent contractors, regardless of compensation level.

Read the full Alert on the Duane Morris LLP website.

October 18, 2023 by Duane Morris

New California Law Further Strengthens the Golden State’s Noncompete Ban

On October 13, 2023, California Governor Gavin Newsom signed into law Assembly Bill 1076, which further expands the claims and remedies against California employers for noncompete agreements that violate state law and requires employers to provide individualized notice to employees and former employees who are parties to noncompete agreements that violate California law. The enactment of this law, on the heels of the enactment of Senate Bill 699 (see our previous Alert), further reinforces the state’s strong policy of prohibiting noncompete agreements in any form.

Read the full Alert on the Duane Morris LLP website.

October 16, 2023 by Duane Morris

California Expands Claims and Remedies Against Employers for Noncompetition Agreements

On September 1, 2023, California Governor Gavin Newsom signed into law Senate Bill 699, which reinforces the state’s prohibition of employee noncompetition agreements and expands the claims and remedies against California employers for noncompetition agreements that violate state law.

Read the full Alert on the Duane Morris LLP website.

July 16, 2023October 16, 2023 by Duane Morris

New York Likely to Become the Latest State to Ban Employee Noncompetition Covenants

On June 20, 2023, the New York Assembly approved legislation that would ban noncompetition agreements in employment contracts. The bill, A1278B/S3100A, is expected to be signed by Governor Kathy Hochul, which will make New York the fifth state in the U.S. to ban noncompetition covenants in agreements between employers and employees. Similar statutes already exist in California, Oklahoma, North Dakota and Minnesota.

Read the full Alert on the Duane Morris LLP website.

June 13, 2023June 22, 2023 by Duane Morris

Minnesota Joins the Ranks of States Banning Employee Noncompetition Covenants

Minnesota is now the fourth state in the U.S. to ban noncompetition covenants in agreements between employers and employees, under a bill signed into law by Governor Tim Walz on May 24, 2023. Similar statutes already exist in California, Oklahoma and North Dakota.

When Does the Law Take Effect?

The law is effective immediately, but only applies to contracts and amendments entered into on or after July 1, 2023―i.e., the law does not apply to covenants not to compete entered into prior to July 1, 2023.

Read the full Alert on the Duane Morris LLP website.

June 2, 2023June 22, 2023 by Duane Morris

NLRB Effort the Latest Attempt to Curtail Enforcement of Non-Compete Agreements

On May 30, 2023, National Labor Relations Board (NLRB) General Counsel Jennifer Abruzzo issued a memorandum asserting that the “proffer, maintenance, and enforcement” of most non-compete provisions in employment contracts violate the National Labor Relations Act (NLRA). This memorandum follows on the heels of other recent efforts to curtail non-compete provisions, including the Federal Trade Commission’s proposed rule that—if enacted and thereafter successful in promised court challenges—would retroactively ban nearly all such provisions in employment agreements; a bipartisan Senate bill that would ban most non-compete provisions going forward; and a slew of recent state legislation making non-compete provisions more difficult for employers to enforce.

Read the full Alert on the Duane Morris LLP website.

February 9, 2023June 22, 2023 by Duane Morris

Bipartisan Senate Seeks to Largely Eliminate Noncompete Agreements in New Bill

In the wake of the Federal Trade Commission’s (FTC) proposed regulation banning noncompete agreements except in limited circumstances, a bipartisan Senate group led by Democrat Senator Chris Murphy of Connecticut and Republican Senator Todd Young of Indiana introduced the Workforce Mobility Act of 2023 on February 1, 2023. If enacted, the legislation would effectively eliminate noncompete agreements entered into after the bill becomes law.

Read the full Alert on the Duane Morris LLP website.

January 6, 2023June 22, 2023 by Duane Morris

FTC Proposes a Retroactive, Nationwide Ban on Non-Compete Clauses

Just one day after entering into consent agreements invalidating non-competes with three companies, on January 5, 2023, the Federal Trade Commission (FTC) proposed a new non-compete rule that would prohibit employers from entering into, maintaining, enforcing or threatening enforcement of a non-compete clause with virtually any worker and invalidate existing non-compete clauses with both current and former workers. If the non-compete rule is finalized by the FTC in the same or substantially same form as proposed, and if it survives the legal challenges that are sure to follow, the non-compete rule would make non-compete clauses an unfair method of competition under Section 5 of the FTC Act, regardless of inconsistent state statutes, regulations, orders or interpretations, and would represent a sea change in the law relating to non-compete clauses in the United States.

Rea the full Alert on the Duane Morris LLP website.