More D.C. Non-Compete Developments: Fasten Your Seatbelt

We have written recently about state legislative proposals to significantly restrict employers' use of non-compete agreements with employees and about court decisions that have limited the enforcement of non-competes. Many states have proposed or enacted strict limitations on employers from requiring non-compete provisions as a tool to protect their legitimate business interests. And, as this week's companion article explores, a California representative introduced legislation in late August, The Restoring Workers' Rights Act of 2022, that would amend the Fair Labor Standards Act to ban non-compete agreements for any employee covered by overtime provisions in the FLSA.

Similarly, a July 2021 Executive Order from President Biden urged the Federal Trade Commission to take action to "curtail the unfair use of non-compete clauses" that limit employee mobility. The clear trend has been to eliminate non-competes or to limit their applicability to very narrow circumstances.