The Open Markets Institute submits testimony applauding CT bill against non-competes but urges the legislature to enact a full ban

WASHINGTON — Open Markets Institute’s legal director, Sandeep Vaheesan, submitted written testimony today lauding Connecticut’s SB 906 – An Act Concerning Non-Compete Agreements and encouraging the state to strengthen its action against non-competes by enacting a full ban. 

SB 906 prohibits non-compete clauses for employees earning up to three times the state minimum wage ($90,000 per year for a full-time employee once Connecticut’s minimum wage increase is fully phased in by June 2023) and restricts the use of non-compete clauses for workers making more than this threshold amount. 

As opposed to only preventing employers from enforcing these contracts in court, SB 906 outlaws non-competes for employees making up to the threshold amount and establishes public and private enforcement of this prohibition. Enforcement is key. Research has found that even when employers are not legally allowed to use non-competes, they use them anyway. In states where employers are not allowed to enforce non-competes, nearly 40% of workers still reported turning down a job offer due to a non-compete clause.

In response, Sandeep Vaheesan, legal director at Open Markets Institute, issued the following statement:

“Non-compete clauses plague workers in Connecticut—and across the country—by restricting worker freedom, road-blocking careers, driving down wages, and protecting dominant firms. With this bill, Connecticut would join a vanguard group of states and territories taking action to protect workers against non-competes in the absence of a federal ban, including the State of Washington and the District of Columbia. 

“Making non-competes illegal and backing it up with legal sanctions is essential for worker security. Connecticut’s SB 906 is an important step in the right direction and we hope the rest of the country takes note and moves to ban non-competes universally, once and for all.”

The Open Markets Institute continues to push for a national ban on non-competes through a Federal Trade Commission rule or legislation. Without an act of Congress, President Biden, who has publicly opposed non-compete clauses for years, can make a federal ban reality by appointing pro-worker commissioners to the FTC.

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Read the full testimony here. 

Read Open Markets’ petition to the FTC to categorically ban worker non-compete clauses through rulemaking here.