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ARTICLE · 06 DECEMBER 2016

Obama Administration Pushes For Employee Non-Compete Reforms

Many U.S. employers use non-compete agreements to protect their sensitive proprietary information.

United StatesEmployment and HR

Many U.S. employers use non-compete agreements to protect their sensitive proprietary information. These agreements establish a "buffer" time period during which a departing employee is prohibited from taking a job with a competitor, often within a defined geographic area. While non-compete restrictions were once linked primarily with highly compensated executive employees, a report issued by the U.S. Treasury Department earlier this year indicates that 18 percent of all workers and 15 percent of all employees without a college degree are currently bound by a non-compete agreement. Workers unlikely to have access to sensitive employer information or trade secrets, such as sandwich makers, temporary warehouse staff and hairstylists, are increasingly being asked to sign non-compete agreements. Concerns about the increase in, and unfair use of, non-compete agreements in employment contracts prompted the White House, on October 25, 2016, to issue a "Call to Action" on

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