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The New York State legislature has passed a bill banning almost all non-compete agreements for all workers, regardless of their salary level or job function.
Specificity: A non-compete agreement must be specific about the activities it prohibits. Additionally, the covenant must clearly articulate what activities are considered competing and those activities must be substantially similar or related to the work the employee performed for the employer.
California law bars covenants not to compete in nearly all circumstances.
Covenants not to compete are frequently enforced where the former employer's "confidential information" may be used or disclosed unless the employee is restrained from competing.
On June 20, 2023, the New York State Assembly passed A1278B, amending the state's current labor law to prohibit non-compete agreements for workers. The bill comes in the wake of the Federal Trade Commission's proposal for a nationwide ban on non-competes.
In New York, a restrictive covenant is considered enforceable if the employer can show that: (1) the restriction is no greater than what is required to protect the employer's legitimate interest, (2) the restriction does not create an undue hardship for the employee, and (3) the restriction does not harm the public.
The agreement is not enforceable because the time period it covers is too long. The period considered reasonable varies by state but typically ranges from 6 months to two years. Longer agreements will likely be found invalid. The territory covered by the agreement is too large.
California law bars covenants not to compete in nearly all circumstances. In Edwards v. Arthur Anderson, the California Supreme Court determined that the law should be read strictly, and not only void the ?unreasonable? noncompete clause, but all noncompete clauses other than those explicitly allowed in the code.