Will Congress Restrict Non-Competes?

Posted by Benjamin I. Fink on

During this past year, there has been some negative publicity regarding non-competes that are imposed on low wage workers by large employers. See, e.g., previous blog entry on this subject.  Perhaps because of that publicity and other incidents involving overuse of non-competes, several Senators have introduced the “Mobility and Opportunity for Vulnerable Employees Act” (the “MOVE Act”), S. 1504.

The Act has two primary components.  The Act would make it illegal to impose non-competes on “low wage employees.”  These employees are generally defined as those earning less than $15.00 per hour (or minimum wage, if higher) or an annual salary of $31,200.  Second, for all other employees working in interstate commerce, the law would require employers to disclose that they will require a non-compete restriction early in the job search process.  The proposed Act says that such disclosure should be “at the beginning of the process for hiring such employee.”  Violations of the Act would be enforced by the Department of Labor.

It is hard to say whether this bill will get any traction in Congress.  The bill has been read twice and referred to the Senate Committee on Health, Education, Labor, and Pensions.  We will keep you posted.