As you may have heard, there is a movement by the federal government to roll back non-compete agreements. The White house wants a crackdown on these contracts so that employees have more freedom in their movement if they want to change jobs. This is certainly understandable — but it also puts a lot of pressure on employers too. Companies want their secrets, work processes, services and products protected, and these non-competes do help them in this regard.
Non-competes have always been a bit contentious and controversial, and for good reason. They restrict the options of an employee if they want to move on to a different company. They can restrict them in terms of time; they can restrict them in terms of geography; they can even restrict them in terms of industry.
Given the power of non-competes, it is no wonder that there is this movement to ban non-competes. In California, this ban has been in effect for some time. There are two other states — North Dakota and Oklahoma — that also have bans on non-competition contracts.
What is important to realize going forward with this issue is that companies will need to be creative to protect themselves and their products.
This doesn’t mean “sneaky” or “conniving.” It just means that companies will utilize legal protections to ensure that their trade secrets and products aren’t spilled to other companies. It is imperative for companies to have proper legal representation to enforce their legal remedies and protect their trade secrets.
Source: USA Today, “White House launches crackdown on non-compete clauses,” Gregory Korte, Oct. 25, 2016