How noncompete clauses clash with US labor laws

Source: Raymond Hogler, The Conversation, August 23, 2017

Most Americans with jobs work “at-will”: Employers owe their employees nothing in the relationship and vice versa. Either party may terminate the arrangement at any time for a good or bad reason or none at all.

In keeping with that no-strings-attached spirit, employees may move on as they see fit – unless they happen to be among the nearly one in five workers bound by a contract that explicitly forbids getting hired by a competitor. These “noncompete clauses” may make sense for CEOs and other top executives who possess trade secrets but seem nonsensical when they are applied to low-wage workers such as draftsmen in the construction industry.

As a scholar of employment law and policy, I have many concerns about noncompete clauses – such as how they tend to make the relationship between workers and bosses too lopsided, suppress wages and discourage labor market mobility. In addition to tracing their legal and legislative history, I have come up with a way to limit this impediment to worker mobility.