Changes Brewing for Enforceability of Non‑Compete Provisions

Courts in most U.S. jurisdictions uphold reasonable non-competition agreements in employment matters. New York has developed rules that protect employers’ legitimate interests and employees from unreasonable restrictions on their ability to earn a living. New York non-competes are enforceable if necessary to protect employers’ legitimate business interests rather than impose an undue hardship on the employee. Now, the Legislature has passed a bill that would ban virtually all employment-related non-competes and the Federal Trade Commission has announced its intention to promulgate a rule broadly banning non-competes. This is a fundamental shift regarding restrictive covenants in New York. This article analyzes the bill and the proposed rule, raises questions about their implications and explores how they might impact non-compete agreements. See “What Employers Should Know About the FTC’s Proposed Ban on Non Compete Provisions” (Mar. 15, 2023).

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