In May, the White House released a report saying 30 million Americans are subject to non-compete clauses. What was once seen as a clause only for high-skills employment positions has now begun to pop up everywhere – including hair styling and sandwich making.
Non-compete clauses are seemingly designed to protect intellectual property and customer bases. However, those are already protected by confidentiality laws. Non-compete clauses, therefore, inhibit labor mobility, forcing workers to look into jobs in other cities – or states – to get a job in their field. What the laws are designed to protect, the local economy, end up hurting that very same thing.
As the New York Times reported, several states have started introducing regulations for non-compete clauses, noting that the Treasury Department has also issued a report criticizing the excessive use of these contracts.
(And since the author of this piece saw mentioned numerous times that lawyers love non-compete clauses, we will just say for the record: that it not the case.)