Beginning September 1, 2025, Texas will significantly narrow the permissible scope of non-compete agreements with certain healthcare employees. The legislation, Senate Bill 1318 (“SB 1318” codified in Tex. Bus. Com. Code § 15.50), represents the biggest legislative adjustment to restrictive covenants in the Lone Star State in decades.Continue Reading Texas Enacts Massive Reforms to Healthcare Provider Non-Competes
On May 19, 2025, the New Jersey legislature followed in New York’s footsteps and introduced two bills, S.B. 4385 and S.B. 4386, seeking to significantly curtail, if not totally ban, the use of non-compete clauses in the employment relationship.Continue Reading New Jersey Legislature Introduces Bills Calling for Sweeping Bans on Non-Compete and No-Poach Agreements
Effective July 1, 2025, Wyoming will restrict the enforceability of non-compete agreements. In enacting Senate Bill 107, Wyoming joins a growing list of states that have significantly restricted, or completely banned, non-compete agreements.Continue Reading Have Employees in Wyoming? Start Preparing for the Non-Compete Ban
The New York Legislature is set to make another attempt to ban non-competes for all but highly compensated individuals. At the end of the 2023 legislative session, the New York Legislature passed a bill that would have banned non-compete agreements for all employees regardless of wage or income level. Governor Kathy Hochul vetoed this bill while expressing her support for a more limited ban stating that she wanted to “strike a balance” between protecting middle-class and low-wage workers and “allowing New York’s businesses to retain highly compensated talent.”Continue Reading New York Legislature Proposes New Bill Banning Non-Compete Agreements
As previously reported (here and here), some Delaware courts have recently declined to “blue pencil,” i.e., modify and narrow overbroad restrictive covenants. Instead, they have stricken in their entirety covenants deemed overbroad and declined to enforce them. On December 10, 2024, in Sunder Energy, LLC v. Tyler Jackson, et al., the Delaware Supreme Court affirmed that Delaware courts have the discretion to decline to blue pencil overbroad restrictive covenants, even if the defendant’s conduct would violate a more narrowly circumscribed covenant. Continue Reading Delaware Supreme Court Refuses to Enforce Noncompete Against Company Founder Who Joined Competitor
An Indiana appellate court recently declined to enforce an executive’s non-compete on the grounds that the covenant’s activity restriction was overbroad.Continue Reading Indiana Appellate Court Rules Medical Company’s Non-Compete with Chief Operating Officer Overbroad and Unenforceable
Washington Governor Jay Inslee recently signed Senate Bill 5935 into law, amending and expanding Washington’s statute restricting the enforceability of noncompetition covenants (Revised Code of Washington 49.2). The amended statute, effective June 6, 2024 and enacted to “facilitat[e] workforce mobility and protect[] employees and independent contractors,” follows a growing trend among states restricting the enforceability of noncompetition covenants and creates additional considerations for employers entering into non-compete agreements with Washington-based employees.Continue Reading Washington’s Amended Non-Compete Law Creates New Considerations for Employers
On April 23, 2024, the Federal Trade Commission (“FTC”) issued its Final Rule banning employers from imposing post-employment noncompete requirements on their workers (the “Final Rule”). The FTC has indicated that it will continue to prioritize enforcement in the healthcare industry, with objectives seeming to include alleviating physician shortages and improving access to healthcare. What the Final Rule means for healthcare organizations generally, and for nonprofits in particular, is not entirely clear and is likely to be challenged. Continue Reading What the FTC’s Noncompete Ban Means for Healthcare
On April 23, 2024, the Federal Trade Commission (the “FTC”) voted 3-2 to issue its final rule (“Final Rule”) banning employers from imposing noncompete clauses on their workers, approving the final rule in a special Open Commission Meeting. Continue Reading FTC Votes to Ban Noncompete Agreements
In Cantor Fitzgerald, L.P. v. Ainslie, No. 162, 2023, 2024 WL 315193 (Del. Jan. 29, 2024), the Delaware Supreme Court held enforceable a “forfeiture for competition” provision in a limited partnership agreement, upholding “the freedom of contract” and enforcing “as a matter of fundamental public policy the voluntary agreements of sophisticated parties.” Given Delaware’s recent shift from its typically non-compete friendly stance, the Delaware Supreme Court’s ruling is beneficial for employers.Continue Reading Delaware Supreme Court Enforces Forfeiture for Competition Provision in Partnership Agreement
On November 17, 2023, New York Governor Kathy Hochul signed a new law that further limits the terms employers may include in release agreements relating to claims of harassment, discrimination, and retaliation. The law took effect immediately and further broadens the restrictions on release agreements already contained in New York General Obligations Law Section 5-336 (“Section 5-336”).Continue Reading New York Amends Its Release Agreement Law for the Third Time