Another Bill in Congress Seeks to Limit Non-Competes, Will This One Go Anywhere?

Another Bill in Congress Seeks to Limit Non-Competes, Will This One Go Anywhere?

Senators Chris Murphy (D-Conn.), Todd Young (R-Ind. ), Kevin Cramer (R-N.D.), and Tim Kaine (D-Va.) introduced the Workforce Mobility Act, a joint measure to restrict the use of non-compete deals, in the United States Senate on February 25, 2021, and Scott Peters (R-Va.) in the United States House of Representatives on February 25, 2021. (D-Cal.).

The Workforce Mobility Act of this year is the latest in a series of efforts at the federal level in recent years to limit non-compete arrangements by legislation. Despite bipartisan cooperation at times, none of them have passed the Senate or the House of Representatives. Is the outcome going to be different this time?

There's a good chance you're right. The Biden administration tends to support a nationwide moratorium on one or more types of non-competition deals. “Biden will work with Congress to eliminate all non-compete agreements, except the very few that are absolutely necessary to protect a narrowly defined category of trade secrets, and outright ban all no-poaching agreements,” said then-President-elect Biden in a Plan for Strengthening Worker Organizing, Collective Bargaining, and Unions released in December 2020.

The Workforce Mobility Act's enactment in 2021, on the other hand, seems to be a long shot. If the bill makes it into Congress, it would be heavily lobbied on both sides of the debate. The bill's restrictions will have a significant effect on employers seeking to shield information that does not qualify as trade secrets, such as corporate planning and customer information. If passed, the bill also has the potential to overturn decades of legal tradition by creating a statute that would be interpreted exclusively in federal courts in an environment where history and precedent have been based on a patchwork of state common law and certain state statutes.