New York Attorney General Initiates Campaign Against Non-Compete Agreements; Why is New Jersey’s Attorney General So Silent (Again)?
This blog has discussed non-compete agreements a few times before, touching on how they can make it unduly difficult for workers seeking out new employment after leaving a job. Non-competes were initially intended to prevent sensitive company and client information from falling into the hands of a competitor when an employee changes companies. However, many employers have been forcing non-compete agreements on low-wage employees who have no knowledge of their employer’s trade secrets, preventing even hoagie shop workers from finding work in other sandwich stores. This exploitative use of non-compete agreements can lead to depressed wages, higher unemployment, and a less competitive labor market.
While these exploitative practices have proliferated, in a positive turn of events, two top political leaders recently launched public campaigns taking aim against them. One of those leaders is New York Attorney General Eric Schneiderman, who, in announcing his actions to limit the use of non-competes, declared that, “workers should be able to get a new job and improve their lives without being afraid of being sued by their current or former employer.” He further promised to introduce legislation about the matter sometime next year. Recognizing that non-compete agreements should be limited only to preventing high-level executives and company insiders from taking trade secrets with them to a rival employer, Schneiderman proposed that employees under a certain wage threshold should be exempt from having to adhere to them. The legislation he intends to introduce would also place a time limit on the restrictions set by non-competes; force employers to pay their potential employees more if they are forced to sign one; and require employers to provide any non-compete agreements to job candidates before making an offer of employment.
Vice President Joe Biden also spoke out against non-competes on behalf of the White House, adding federal pressure on state political authorities all over the country to take action. Biden wrote in his blog post that, “workers can’t reach their true potential without freedom to negotiate for a higher wage with a new company, or to find another job after they’ve been laid off.” The White House also expressed its support for Schneiderman’s proposed plans, along with endorsing a ban on non-compete agreements on employees working in the area of public health and safety. The White House also spoke out against non-compete restrictions placed on those who are fired without cause.
Unfortunately, New Jersey’s Attorney General has been woefully silent on this issue, and his inaction on this issue only reinforces the conclusion we have reached over the years that the Office of the New Jersey Attorney General is concerned primarily with protecting the interests of the government, rather than advocating on behalf of the State’s citizens. The fact that New Jersey employers can continue to get away with imposing non-competes on employees without justification is a matter of concern to all of us. If you feel that you are being unfairly restricted by a non-compete agreement, it is important to consult with an experienced New Jersey employment lawyer. For a consultation with Schall & Barasch, we encourage you to fill out our online Questionnaire, which you can find on the home page of this website under “Contact Us Now.”
Written by: Richard M. Schall, Esq.
Schall & Barasch LLC
110 Marter Avenue, Suite 302
Moorestown, NJ 08057
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