Indiana Senator aims to free workers from non-compete clauses

WASHINGTON, D.C. (WTWO/WAWV) — An Indiana senator has reintroduced a bipartisan bill in the US Senate aimed at helping improve worker mobility with regard to non-compete agreements.

Senator Todd Young (R-Ind.) and Chris Murphy (D-Conn.) reintroduced the Workforce Mobility Act Wednesday.

According to a release, 20% of American workers are subject to some form of a non-compete agreement. Non-compete agreements are designed to prevent workers from leaving their jobs for a competitor or starting a competing business.

Sen. Young said this restricts the mobility of workers and harms wage growth.

“Non-compete agreements stifle wage growth, career advancement, innovation, business creation, and human freedom. Our bill aims to remove these barriers and create opportunities that help, not hinder, Hoosier workers,” said Young. “The reforms in our legislation will assist workers and entrepreneurs so they can freely apply their talents where their skills are in greatest demand.”

Senators from North Dakota and Virginia have co-sponsored the bill. And similar legislation was introduced into the House of Representatives by Congressmen Scott Peters (D-Calif.) and Mike Gallagher (R-Wis.).

The senators say the Workforce Mobility Act would:

• Narrow the use of non-compete agreements to include only necessary instances of a dissolution of a partnership or the sale of a business.
• Require employers to make their employees aware of the limitation on non-competes, as studies have found that non-competes are often used even when they are illegal or unenforceable. The Department of Labor would also be given the authority to make the public aware of the limitation.
• Require the Federal Trade Commission and the Department of Labor to submit a report to Congress on any enforcement actions taken.

“It’s ridiculous we let companies hide behind these agreements as a means to depress wages and stave off competition. I’m glad the FTC has proposed a rule to ban the use of non-competes, but Congress should go even further and pass our legislation to protect workers and support entrepreneurs,” said Sen. Murphy.

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