Many employers force their workers to sign non-compete agreements, which prevent them from going to work for a competitor. But are such agreements enforceable?
In April 2024, the federal Fair Trade Commission adopted a new rule banning most non-competes. “Noncompete clauses keep wages low, suppress new ideas, and rob the American economy of dynamism, including from the more than 8,500 new startups that would be created a year once noncompetes are banned,” said FTC Chair Lina M. Khan. “The FTC’s final rule to ban noncompetes will ensure Americans have the freedom to pursue a new job, start a new business, or bring a new idea to market.” A federal court has put a hold on the new rule, however, so we don't know when or if it will go into effect.
In the meantime, what should you do if your former employer is trying to enforce a non-compete? In Connecticut, courts look at five things to determine whether or not to enforce a non-compete. First, is it reasonable in geographic scope? If the employer only operates in one state, but your non-compete is nationwide, it may be overly broad. Second, is it reasonable in temporal scope? A one-year limitation has been found to be presumptively reasonable. Third, courts look at the reasonableness of the protection afforded to the employer. For example, does a sandwich shop really need the protection of a non-compete for its minimum-wage workers? Fourth, courts look at the impact on the ability of the employee to work in their field. And finally, courts consider the effect of the agreement on the public interest. Thus, for example, courts will not enforce an agreement that prevents a lawyer from practicing because it interferes with the public's interest in selecting their own legal counsel.
If your former employer is trying to enforce a non-compete against you, call the Law Offices of Anthony J. Pantuso, III at 203-726-0284
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