The Freedom to Compete Act seeks to prevent employers from forcing hourly workers to sign non-compete agreements, which make it next to impossible to switch jobs in hopes of earning a higher wage. More than 10 percent of workers who earn less than $40,000 annually are locked into a non-compete agreements nationwide, stifling their ability to make a better living. The proposed legislation seeks to change this.
Employees are sometimes asked to sign non-compete agreements or restrictive covenants where they agree not to start a competing business or work for a competitor within a geographic area for a specified time after leaving a company. Non-competes protect employers from an employee using their knowledge of the business to compete against them, but are seen as inappropriate for entry level jobs.
The Freedom to Compete Act would limit some employees from having to enter into non-compete agreements making it possible for hourly workers to find employment with competitors. The ability for employers to protect trade secrets would remain in force, however, in most cases the proposal covers service occupations such as sandwich makers, drivers and the like that typically have little exposure to the inner workings of a business anyhow. Research shows that allowing hourly workers the opportunity to switch jobs almost always results in a higher wage, allowing many workers to get a leg up.
If you have been asked to sign a non-compete agreement or restrictive covenant or you are in violation (breach) of an non-compete agreement, contact the Davenport, Iowa employment law offices of McDonald, Woodward & Carlson PC for assistance today at 563-355-6478.