Seward & Kissel LLP Survey Offers New Insight on Noncompete Agreements
Seward & Kissel, a leading law firm to asset managers and other employers, is making available an analysis of how six key states address a critical and evolving legal issue for employers and employees: limitations on non-competition agreements. Seward & Kissel’s report, Noncompete Agreements Under the Microscope: A Survey of Recent Trends, analyzes various legislative and judicial developments regarding noncompete agreements that may place such agreements in jeopardy. The report focuses on six states where many financial institutions and other Seward & Kissel clients are based: California, Connecticut, Delaware, Massachusetts, New Jersey, and New York.
The report identifies proposed and existing legislation governing noncompete agreements in the six states and includes a practical chart indicating how current and proposed legislation addresses various issues such as noncompete duration, compensation during the noncompete period, and circumstances in which noncompete agreements are prohibited. Of the states surveyed, only California and Massachusetts currently have noncompete legislation, and the Massachusetts legislation, while more recent, has become a model for other states. New York is considering a bill that includes many of the features in the Massachusetts Act. New Jersey considered a similar bill in 2019 which did not pass but is poised to reintroduce the bill during the 2020 legislative session, as outlined in the analysis.
“Talent management has always been one of the thorniest issues for employers to handle,” said Seward & Kissel partner Michael McNamara, lead author of the report. “With so many employees working under noncompete restrictions, and the law moving so swiftly, this is an area that we are proactively monitoring for our client base.”
Between 36 million and 60 million private sector workers in the United States are subject to noncompete agreements, and nearly 50% of employers use noncompete agreements for at least some of their employees. The Noncompete Agreements Under the Microscope report offers a snapshot of the law covering noncompete agreements in six high-profile states.