State Attorneys General On The Attack Against Noncompete Overuse

Too much of a good thing can be bad – a maxim that some employers have historically ignored by requiring entire workforces, including rank-and-file employees, to submit to post-employment noncompete obligations as a condition of continuing employment. In recent months, however, state attorneys general, specifically in New York and Illinois, have put significant heat on employers that have engaged in this practice and, in doing so, appear to be opening a new front in the battle over noncompete agreements. For example:

• In June, Illinois Attorney General Lisa Madigan filed a lawsuit against a national sandwich chain, seeking to invalidate form noncompete agreements that indiscriminately applied to all franchise employees, including sandwich makers and delivery persons, and purported to bar them from subsequent employment with competing sandwich shops.