New York’s Proposed Non-Compete Ban Remains in Holding Pattern

December 21, 2023

On June 20, 2023, the New York State Assembly passed bill A1278B (previously passed by the New York State Senate as bill S3100A), which would establish a ban on non-compete agreements between employers and all employees, from entry-level employees all the way to C-Suite executives. While Governor Kathy Hochul still has not indicated what action she intends to take regarding this bill (which would become known as New York Labor Law Section 191-d), in remarks to the press, the governor recently signaled her desire to see the law modified to focus on protecting low and middle-income workers, i.e., by potentially limiting the ban to individuals earning less than $250,000/year. Numerous states have enacted legislation in recent years prohibiting employers from entering into non-competes with employees being paid below a specified annual salary or hourly wage (or precluding non-competes with hourly workers entirely), and this appears to be the governor’s preferred approach.

This memorandum was updated by Cahill on January 4, 2024 after New York’s pending non-compete bill was subsequently vetoed by Governor Kathy Hochul.

CGR Memo - New York’s Proposed Non-Compete Ban Remains in a Holding Pattern