Is This the Beginning of the End of the Noncompete Agreement in New York?

The New York State legislature is presently considering outlawing noncompete agreements in certain circumstances. Although New York courts strongly disfavor such covenants against competition, employers may soon be prevented from enforcing such agreements against low-wage workers or employees who were terminated without cause. Presently, an employer may prevent a former employee from competing with that employer, as long as the employer demonstrates a “reasonable” basis for such a restraint. If legislation currently making its way through Albany becomes law, New York employers may be prevented from enforcing such provisions against many employees. Importantly, New York employers may soon be enjoined from enforcing so-called “no poach provisions,” or clauses designed to prevent a competitor from soliciting or hiring another competitor’s talent. New York employers and employees alike should consult with competent counsel experienced with employment restrictive covenants prior to entering into such an agreement to ensure continued compliance with this evolving area of law.