Protecting Employers Property From Harm by Former Employees: What Can Be Used if Non-Compete Are No Longer Valid?
DOI:
https://doi.org/10.33423/jlae.v21i3.7214Keywords:
leadership, accountability, ethics, non-compete, alternative agreements, protecting employer property interestsAbstract
Non-competition agreements employers have relied on to prevent former employee competition are increasingly unenforceable in the courts and may be banned altogether. Concerns that they unduly limit an individual’s ability to work have been joined by recent studies that show use is also causing several incidents of macroeconomic damage. Employers need to consider adopting alternative means to protect property interests that could be placed at risk by competing former employees. When doing so, care should be taken to use terms that comply with governing law and are made binding on employees only as necessary to protect employers’ at-risk property interests.
References
.15 U.S.C. § 6151 National Do-Not-Call Registry. (2003).
Atlas, C.R. (2023, May 15). Bipartisan bill to ban most non-compete agreements reintroduced in U.S. Senate. Jackson Lewis. Retrieved July 18, 2024, from https://www.jacksonlewis.com/insights/bipartisan-bill-ban-most-non-compete-agreements-reintroduced-us-senate
Chamber of Commerce, et al. v. FTC and Lina Kahn, No. 6:24-cv-00148 (E.D. Tex. 2024).
Defend Trade Secrets Act, 18 U.S.C. § 1836 et seq., Pub. L. 114-153, 130 Stat. 376 (2016).
Exec. Order No. 14036, Promoting Competition in the American Economy, 86 Fed. Reg. 36987 (July 14, 2021).
Federal Trade Commission Act, 15 U.S.C. §§ 41–56, as amended.
Federal Trade Commission. (2023). Non-compete clause rule, 16 C.F.R. Part 910.
Federal Trade Commission. (n.d.). FTC announces rule banning non-competes. Retrieved July 10, 2024, from https://www.donotcall.gov/
Hsu, A. (2023, January 13). Many workers barely recall signing noncompetes, until they try to change jobs. NPR. Retrieved July 18, 2024, from https://www.npr.org/2023/01/13/1148446019/ftc-rule-ban-noncompetes-low-wage-workers-trade-secrets#:~:text=Many%20workers%20barely%20recall%20signing%20noncompetes%2C%20until%20they%20try%20to%20change%20jobs,-Listen%C2%B7%204%3A36&text=Dazeley%2FGetty%20Images-,One%20in%205%20workers%20in%20the%20U.S.%2C%20or%20some%2030,barely%20even%20remember%20signing%20them
Labor and Employment Law Practice Group. (2023, August 25). Post-employment non-competes require additional consideration in Pennsylvania. Legal News & Business Law News. National Law Review. Retrieved July 18, 2024, from https://natlawreview.com/article/post-employment-non-competes-require-additional-consideration-pennsylvania
Lobel, O. (2024, May 8). The FTC’s noncompete ban was long overdue. Harvard Business Review. Retrieved July 18, 2024, from https://hbr.org/2024/05/the-ftcs-noncompete-ban-was-long-overdue
Loper v. Bright Ent. v. Raimondo, 603 U.S. ___ (2024).
Restatement (Second) of Torts § 558 et seq. (Am. L. Inst. 2020).
Restatement (Second) of Torts § 766 (Am. L. Inst. 2020).
Sahadi, J. (2024, April 23). FTC finalizes rule banning most employers from using noncompete clauses, but legal challenge is expected. CNN Business. Cable News Network. Retrieved July 18, 2024, from https://www.cnn.com/2024/04/23/success/ftc-bans-non-compete-clauses/index.html
Trademark Act of 1946, as amended, 15 U.S.C. § 1051 et seq. (2023).
U.S. Copyright Act, 17 U.S.C. §§ 101–810 (2023).
U.S. Patent Act, 35 U.S.C. §§ 1–390, as amended by the Leahy-Smith America Invents Act (2023).
Uniform Trade Secrets Act with 1985 Amendments. (2020).
Warner-Lambert v. Federal Trade Commission, 562 F.2d 749 (1977), cert. denied, 98 S. Ct. 1575 (1978).
West Virginia v. E.P.A., 142 S. Ct. 2587 (2022).
Wiessner, D. (2024, April 23). US bans worker “noncompete” agreements as business groups vow to sue. Reuters. Retrieved July 18, 2024, from https://www.reuters.com/world/us/us-agency-poised-ban-worker-noncompete-agreements-2024-04-23/
