New York is on the brink of potentially outlawing noncompete agreements, a move that would impact approximately one in five American workers, according to the Federal Trade Commission. Governor Kathy Hochul, currently deliberating on the decision to endorse the ban, has proposed a compromise suggesting that noncompetes be permissible for individuals earning $250,000 or more. If Governor Hochul proceeds with an outright ban across all pay levels, New York would set a precedent as one of the most comprehensive states in terms of restricting noncompete agreements. Some factions within the business community are opposing this initiative, asserting that companies prefer to operate in states where their proprietary information is safeguarded.
New York could soon join the ranks of four states, including California, that have rendered noncompetes unenforceable across all salary tiers. Although initially targeted at high-ranking executives, noncompete agreements have progressively expanded their reach in recent years to encompass a diverse range of professions, extending from hairstylists to baristas.
The Federal Trade Commission is reportedly on the verge of finalizing its own nationwide prohibition on noncompete agreements, reflecting a broader trend towards limiting the prevalence of such agreements in employment contracts.
New York Ban on Worker Non-Compete Clauses Awaiting Governor’s Approval