Minnesota this year became the first state in a century to ban noncompete agreements, freeing workers from contracts that temporarily prevent them from taking jobs at rival businesses. New York will follow if Gov. Kathy Hochul (D) approves a bill headed to her desk.
The bold moves in both states come as research and years of eyebrow-raising headlines show noncompetes are ubiquitous and often harm workers. Some economists say the contracts hold down wages, stifle innovation and can force workers to leave an industry or move far away.
“In order to sort of unclog the economy, you need to get away from these noncompetes,” said New York Sen. Sean Ryan (D), sponsor of the proposed ban in his state.
About a quarter of New York workers are bound by such contracts, he said. “If a quarter of your workforce can’t freely walk across the street to get another job, that’s a problem.”
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