Attorney General Michelle Henry has joined a coalition of 17 other Attorneys General in supporting the Federal Trade Commission’s proposal to prevent businesses from requiring employees to sign non-compete agreements as a condition of employment. The coalition believes that non-compete agreements are unfair, overly restrictive, and ultimately hinder an employee’s ability to change jobs, particularly for low- and middle-wage workers.
Currently, each state has different laws on non-compete agreements, and research has shown that workers across all income levels experience higher wages and job mobility in states that have banned non-competes. In contrast, in states where non-competes are more likely to be enforced, all workers, even those who are not subject to such agreements, experience relatively reduced job mobility and lower wages.
Non-compete agreements can be particularly harmful to low and middle-wage workers who lack bargaining power and legal resources to challenge them. The prevalence of non-competes in the health care industry has also resulted in a further consolidation of that industry, inflating care prices and decreasing wages.
The coalition believes that a national ban on non-competes will provide uniformity across states, greater predictability and security to employees subject to unreasonable non-compete agreements, and positive effects on job mobility, employee wages, and entrepreneurship across Pennsylvania and beyond. The letter was signed by the Attorneys General of California, Colorado, Delaware, the District of Columbia, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, Oregon, Rhode Island, and Washington, in addition to Attorney General Michelle Henry.
