Nearly 30 million American are covered by the clauses, government figures show
As part of efforts to reform US antitrust laws, the country’s House Democrats are seeking to determine whether inappropriate non-compete clauses should be prohibited.
In a speech before the Open Markets Institute earlier this month, Rhode Island Rep. David Cicilline said the use of non-compete clauses in everyday employment contracts was a fundamental threat to workers’ economic freedom and mobility.
“These clauses are widespread, even among workers who do not possess trade secrets, such as workers in the fast-food industry,” he said.
According to a report by the US Treasury Department released last year, close to 30 million Americans across all employment levels are covered by non-compete clauses. Less than a quarter said their jobs involve trade secrets, while less than half of non-compete agreements involve work subject to trade secrets.
And yet, the report added that these clauses prevent workers from finding new employment even after being fired without cause.
“[I]n many cases, workers have already accepted a job before they even see the text of an employment contract or are simply unaware that they have agreed not to work for a competing business,” Cicilline said. “When combined with forced arbitration clauses, which immunize unscrupulous employers from virtually any legal accountability, non-compete clauses lock in workers, even when they are in a harmful, discriminatory workplace.”
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In a speech before the Open Markets Institute earlier this month, Rhode Island Rep. David Cicilline said the use of non-compete clauses in everyday employment contracts was a fundamental threat to workers’ economic freedom and mobility.
“These clauses are widespread, even among workers who do not possess trade secrets, such as workers in the fast-food industry,” he said.
According to a report by the US Treasury Department released last year, close to 30 million Americans across all employment levels are covered by non-compete clauses. Less than a quarter said their jobs involve trade secrets, while less than half of non-compete agreements involve work subject to trade secrets.
And yet, the report added that these clauses prevent workers from finding new employment even after being fired without cause.
“[I]n many cases, workers have already accepted a job before they even see the text of an employment contract or are simply unaware that they have agreed not to work for a competing business,” Cicilline said. “When combined with forced arbitration clauses, which immunize unscrupulous employers from virtually any legal accountability, non-compete clauses lock in workers, even when they are in a harmful, discriminatory workplace.”
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Beyond legal acumen: 5 must-have skills in today’s business landscape