FT 14-19-Non-compete abolition act (final vote).

[Roblox]

An Act

To ban non compete agreements and ensure more freedom for workers.

Section 1(Title and definitions).
i. This act may be referred to as "Non-compete abolition act".
ii. A non-compete agreement is defined here as a clause in which an employee agrees with an employer not to enter into or start a similar profession or trade, in order to avoid competition with the employer.

Section 2 (Non-compete ban).
i. Under this act, all non-compete agreements are prohibited.
ii. All previously existing non-compete agreements are null and void.
iii. An employer found to be in violation of Section 2, parts i and/or ii could be fined up to, but no more than, an amount equivalent to 20% of their latest gross annual earnings within the region of Fremont.

Section 3 (Enactment).
i. This act takes effect on June 1st, 2020.

Sponsor: Roblox

[Roblox]

Ah, well-for too long, non-compete agreements have restricted workers of all trades, often keeping them in unsatisfying positions. It also stifles a free flow of ideas and innovation. With this bill, I wish to relieve the stranglehold of these outdated agreements to the benefit of workers and the economy.

[Unconditional Surrender Truman]

An excellent bill. Parliament can and should use its regulatory powers to increase economic freedom wherever we can.

[PSOL]

I congratulate the Speaker for introducing yet again another great piece of legislation that I will vote Aye on.

[KoopaDaQuick 🇵🇸]

Not a shabby idea. Probably voting aye.

[AustralianSwingVoter]

Completely banning all non-compete agreements is an utterly nonsense position that I have not a shred of doubt in totally opposing. Once again those on the government benches take a reasonable common sense position, of implementing sensible restrictions on non-compete agreements to codify and expand upon the restrictions existent in common law, and takes it in extremis to a nonsense ill-thought out hardline.

[Unconditional Surrender Truman]

Completely banning all non-compete agreements is an utterly nonsense position that I have not a shred of doubt in totally opposing. Once again those on the government benches take a reasonable common sense position, of implementing sensible restrictions on non-compete agreements to codify and expand upon the restrictions existent in common law, and takes it in extremis to a nonsense ill-thought out hardline.

Out of curiosity, what in your view would constitute "sensible restrictions" in this case?

[AustralianSwingVoter]

Completely banning all non-compete agreements is an utterly nonsense position that I have not a shred of doubt in totally opposing. Once again those on the government benches take a reasonable common sense position, of implementing sensible restrictions on non-compete agreements to codify and expand upon the restrictions existent in common law, and takes it in extremis to a nonsense ill-thought out hardline.

Out of curiosity, what in your view would constitute "sensible restrictions" in this case?

Non compete clauses fundamentally exist to protect intellectual property and trade secrets. The decision in Mitchel v Reynolds (1711) sets out the restrictions on non compete clauses. A clause should be reasonably worded, limited in frame and scope and to pass legal muster the company must prove that the agreement is reasonably required to protect their proprietary rights.
And the British System of Gardening Leave works very well in reasonably enforcing non compete agreements. After resignation or termination employees are still kept on the payroll and are adequately compensated for the duration of their non compete clause.

Non compete agreements exist on narrow lines to protect intellectual property and uphold competition within market, without becoming an unreasonable restraint of trade. If there is a legitimate business interest to be protected then it should be allowed to be protected within reasonable grounds and for a limited portion of time.

[Sestak]

Didn’t we do this a while ago federally?

Edit: Yes, we had this passed during the Weatherboy Admninistration:

This bill will help all workers of our nation, and has broad support. I see no reason why I shouldn't sign this.

Ending Employer Restrictions Act

To prohibit non-compete agreements between an employer and employee and to prohibit restrictive employment agreements between two or more employers for the purpose of restricting the employment of an employee.

Section 1. Short title

This Act shall be cited as the “Ending Employer Restrictions Act”.

Section 2. Definitions

As used in Act, unless otherwise provided or indicated by the context:
(1) The term “employer” shall have the meaning as described in the Fair Labor Standards Act of 1938 (29 U.S.C. § 203).
(2) The term “employee” shall have the meaning as described in the Fair Labor Standards Act of 1938 (29 U.S.C. § 203).
(3) The term “partnership” shall have the meaning as described in 26 U.S.C. § 701.
(4) The term “limited liability company” shall have the meaning as described in 15 U.S.C. § 662.
(5) The term “member” shall have the meaning as described in 15 U.S.C. § 662.
(6) The term “non-compete agreement” shall mean a contract between an employer and employee that prohibits or restricts an employee from working for an employer in the same industry or one that is a competing company or organization.
(7) The term "restrictive employment agreement” shall mean an agreement, including a franchise agreement or a contractor-subcontractor agreement, between two or more employers that prohibits or restricts one employer from soliciting or hiring another employer’s employees or former employees.

Section 3. Unlawful agreements

(a) In general. -

(1) It shall be unlawful, except for the exceptions listed in subsection (b), for any employer, member, or partner to:
(A) enter into a non-compete agreement with an employee, member, or partner; or
(B) enforce or threaten to enforce a non-compete agreement.

(2) It shall be unlawful for any employer, member, or partner to:
(A) enter into a restrictive employment agreement; or
(B) enforce or threaten to enforce a restrictive employment agreement.

(b) Exceptions. -

A non-compete agreement can be entered into and enforced if:
(A) it is between a seller and a buyer, in the case of an owner of a business selling the entire business or the goodwill in the business;
(B) it is between former partners, in the case of a dissolution or dissociation of a partnership;
(C) it is between former members, in the case of a dissolution of a limited liability company;
(D) it only prevents an employee from working for a competing employer while they are still employed by the employer they signed the non-compete agreement with;
(E) it is included as part of a personal services contract lasting no longer than the length of employment guaranteed in the contract; or
(F) it is used to protect trade secrets.


(c) Enforcement. -

(1) An employer who performs an unlawful action as determined in subsection (a) shall be liable to the affected employee or individual in an amount equal to the sum:
(A) of all damages sustained by the employee or individual as a result of the unlawful action of the employer;
(B) punitive damages as the court may allow; and
(C) reasonable attorney’s fees as determined by the court.

(2) An employee or individual may bring a civil action under paragraph (1) in any appropriate district court of Atlasia.

(3) The Federal Trade Commission shall have the power to enforce all provisions and punish all violations of the provisions by employers as determined in section (3)(a) as allowed in the Federal Trade Commission Act (15 U.S.C. § 41 et seq.).

Section 4. Implementation

This Act shall take effect immediately upon its passage.

People's House of Representatives
Passed in the House of Representatives 8-0-0-1



House of Representatives
Passed 5-0 in the Atlasian Senate
X YE

President of Congress,
be it enacted
X YE

President of the Republic of Atlasia

Obviously there’s nothing wrong with passing a secondary ban at the regional level, just wanted to make sure you all were aware of the federal statute.

[PSOL]

I mean there really is no harm in adding more padding for security of our workers in the future. Might as well pass it given the work that’s been put so far on it.

[AustralianSwingVoter]

I mean there really is no harm in adding more padding for security of our workers in the future. Might as well pass it given the work that’s been put so far on it.

Non compete agreements exist to protect Intellectual property. The vast majority of workers will never be affected by them. There's no reason to ban them when they do have important uses.

[Roblox]

Motioning for a final vote.

[AustralianSwingVoter]

Objection, my concerns still haven't been addressed.

[AustralianSwingVoter]

An Act

To ban non compete agreements and ensure more freedom for workers.

Section 1(Title and definitions).
i. This act may be referred to as "Non-compete abolition act".
ii. A non-compete agreement is defined here as a clause in which an employee agrees with an employer not to enter into or start a similar profession or trade, in order to avoid competition with the employer.

Section 2 (Non-compete ban restrictions).
i. Under this act, all non-compete agreements are prohibited.
ii. All previously existing non-compete agreements are null and void.
iii. An employer found to be in violation of Section 2, parts i and/or ii could be fined up to, but no more than, an amount equivalent to 20% of their latest gross annual earnings within the region of Fremont.
i. A non-compete agreement shall be regarded as unenforceable unless the employer can prove a legitimate business interest that the non-compete agreement will protect, the non-compete agreement lasts for no longer two years, is only applicable within the Region of Fremont, and the employer is required to pay financial compensation for the duration of the agreement equivalent to at least half of their gross salary for the corresponding period.
ii. Any existing non-compete agreements that do not comply with this legislation will be deemed unenforceable.

Section 3 (Enactment).
i. This act takes effect on June 1st, 2020.

[Roblox]

I accept ASV's amendment.

[Unconditional Surrender Truman]

The amendment having been adopted, I move for a final vote.

[Roblox]

Now opening a final vote here.

Aye.

[PSOL]

Aye

[Unconditional Surrender Truman]

Aye!

[AustralianSwingVoter]

Aye

[KoopaDaQuick 🇵🇸]

Sorry if I've missed some recent votes, I've had some other concerns recently.

Aye

[Unconditional Surrender Truman]

AN ACT
to ban non compete agreements and ensure more freedom for workers.

Section 1 (Title and definitions).
i. This act may be referred to as "Non-compete abolition act".
ii. A non-compete agreement is defined here as a clause in which an employee agrees with an employer not to enter into or start a similar profession or trade, in order to avoid competition with the employer.

Section 2 (Non-compete restrictions)
i. A non-compete agreement shall be regarded as unenforceable unless the employer can prove a legitimate business interest that the non-compete agreement will protect, the non-compete agreement lasts for no longer two years, is only applicable within the Region of Fremont, and the employer is required to pay financial compensation for the duration of the agreement equivalent to at least half of their gross salary for the corresponding period.
ii. Any existing non-compete agreements that do not comply with this legislation will be deemed unenforceable.

Section 3 (Enactment).
i. This act takes effect on June 1st, 2020.