When you own a business, it can be hard to keep up to date with the ever-changing landscape of “dos and don’ts.” One bill that would affect businesses and employees alike concerns noncompete clauses.
Noncompete clauses: The arguments for and against
Noncompete clauses can often be seen as a part of severance agreements to limit a former employee’s prospective employment opportunities. Companies desire to protect proprietary information, and employees want to seek employment in industries they know.
Opponents of noncompete clauses argue that clauses weaken the economic position of the employee moving forward.
Recently, the Federal Trade Commission began formulating new rules that may ultimately restrict the enforceability of noncompete agreements nationwide. Those rules remain in the planning stages.
When laws change, consider how it affects your business
If you are an employer, it is important to modify existing severance documents when legislation affecting the validity of your document changes. If you are an employee, it is also important to know your rights.
Employees do not have to sign a severance agreement if they do not agree to the terms. Alternatively, employees may negotiate.
It is important to keep an eye on New York’s non-compete bill if your company or business routinely uses these agreements. Companies should review their severance agreements regularly to make sure they are legal.
