Indiana is making strides to enhance physician mobility with a new amendment to its 2020 Physician Non-Compete Statute (Ind. Code § 25-22.5-5.5). This latest change, signed into law by Governor Mike Braun on May 6, 2025, broadens the limitations on non-compete restrictions to encompass all physicians employed by hospitals or related entities. The new law, Senate Enrolled Act No. 475, will come into effect on July 1, 2025, aligning Indiana with the growing national trend towards greater freedom for physicians to move between employers. Read more.

Virginia has taken a significant step in tightening restrictions on employment non-compete agreements. Governor Glenn Youngkin recently signed a bill that broadens the definition of low-wage employees under the state’s existing prohibition on covenants not to compete, Va. Code Ann. § 40.1-28.7:8. Starting July 1, 2025, this new statute will prevent employers from entering into non-compete agreements with employees classified as non-exempt under the Fair Labor Standards Act (FLSA). Read more.

On April 23, 2024, the Federal Trade Commission (FTC) issued its final rule prohibiting all non-compete agreements for all employees at all levels, with only extremely limited exceptions. The FTC’s much-anticipated action follows its January 2023 proposed rule and its review of over 26,000 public comments. Though approved 3-2 along party lines by the FTC, the final rule is not yet effective and legal challenges already are looming. Read more.

In October 2023, California’s Governor signed Assembly Bill (AB) 1076 which added the new Business & Professions Code §16600.1, making it unlawful to impose non-compete clauses on employees – which contractual restrictions already are void under Business & Professions Code §16600.

Under AB 1076, employers must notify current employees and former employees (employed after January 1, 2022), that any noncompete agreement or noncompete clause contained within an agreement the current or former employee signed is void unless the agreement or clause falls within one of the statutory exceptions set forth in Business and Professions Code section 16600, et seq.

Read the full article on Jackson Lewis’ California Workplace Law Blog.

New York Governor Kathy Hochul vetoed Senate Bill S3100A, a bill passed by both houses of the legislature in June, that would prohibit all non-compete agreements. This is a significant and interesting end to a year of upheaval in the world of non-compete agreements and other restrictive covenants. Read more.

California’s Governor signed Assembly Bill (AB) 1076 on October 13, 2023, which adds new Business & Professions Code §16600.1, making it unlawful to impose non-compete clauses on employees – which contractual restrictions already are void under Business & Professions Code §16600. Read more.

On September 15, 2023, New York Governor Kathy Hochul signed into law a new section of the New York Labor Law limiting the assignment of inventions by employees to their employers. Specifically, Section 203-f of the Labor Law renders unenforceable provisions in employment agreements that require employees to assign certain inventions to their employer which were developed using the employee’s own property and time. The new law became immediately effective upon Governor Hochul’s signing.

New Labor Law Section 203-f bans the enforcement of invention assignment agreements that entitle employers to intellectual property developed by employees entirely on their own time without using their employer’s equipment, supplies, facilities, or trade secret information; unless the invention relates at the time of conception or reduction to practice of the invention to the employer’s business, or actual or demonstrably anticipated research or development of the employer, or if the invention results from any work performed by the employee for the employer.
Section 203-f further provides that a requirement in an employment agreement that an employee assign, or offer to assign, any of his or her rights in an invention developed on his or her own time to an employer is against New York State public policy and shall be unenforceable. Notably, Section 203-f does not state that such a provision renders an entire employment agreement unenforceable if it contains such a provision and does not create a private right of action.

The new bill was originally sponsored by New York State Senator Jessica Ramos from the 13th Senate District. State lawmakers approved the legislation in June 2023 after other States, including California, Illinois, New Jersey, and Nevada approved similar protections.

In fact, the bill provides protections similar to California’s Labor Code Section 2870. However, the New York legislation differs from its California counterpart in that California Labor Code Section 2870 includes language that explicitly allows employers to require employees to disclose all inventions employees develop during the term of their employment. California also places a burden on employees to prove that their inventions are not covered by their employee invention assignment agreement.

As a result, employers should review their employment agreements in New York to ensure they comply with the new law and draft any new agreements accordingly. Jackson Lewis attorneys continue to monitor further developments. If you have any questions, the Jackson Lewis Restrictive Covenants, Trade Secrets and Unfair Competition practice group members are available to assist.

On September 1, 2023, Governor Newsom signed Senate Bill (SB) 699, which buttresses current state law that voids contracts that restrain an employee from engaging in a lawful profession, trade, or business of any kind. California’s Business and Professions Code section 16600 states, “[E]very contract by which anyone is restrained from engaging in a lawful profession, trade, or business of any kind is to that extent void.” Read more.

In the world of restrictive covenants, 2023 got off to a hot start when, in early January, the Federal Trade Commission (FTC) issued a Notice of Proposed Rulemaking (NPRM) to broadly ban the use of non-compete covenants nationally. Now, Congress has stepped into the fray, with a bipartisan group of Senators reintroducing a bill that, like the FTC’s proposed rule, would ban non-compete agreements across the country in most circumstances.

The Workforce Mobility Act of 2023

The Workforce Mobility Act of 2023, previously introduced in 2019 and 2021, was reintroduced by Senators Christopher Murphy (D-Conn.) and Todd Young (R-Ind.) and is co-sponsored by Senators Tim Kaine (D-Va.) and Kevin Cramer (R-N.D.). If passed, the Act would codify the use of employment non-competes as an unfair trade practice under federal law. The Act provides that, with certain limited exceptions, “no person shall enter into, enforce, or attempt to enforce a noncompete agreement with any individual who is employed by, or performs work under contract with, such person with respect to activities of such person in or affecting commerce,” and that noncompete agreements will have no force or effect. For a more detailed look at the Workforce Mobility Act of 2023, see our article, Bipartisan Bill to Ban Most Non-Compete Agreements Reintroduced in U.S. Senate.

The FTC’s Proposed Rule

Jackson Lewis previously addressed the details of the FTC’s proposed ban on non-competes in its article, A Deeper Dive Into FTC’s Proposed Non-Compete Rule. Now, Jackson Lewis attorneys Erik Winton, Cliff Atlas, Daniel Doron, and Daniel Thornton take a look at the history leading to the proposed rule, including how the FTC appears to have largely ignored the finding and conclusions presented by outside experts during a January 2020 public workshop, conducted by the Commission to examine the legal basis and empirical support for a rule restricting non-competes. See our article, Against the Evidence: How the FTC Cast Aside the Input of Experts at Its Own Non-Compete Workshop.

Cliff Atlas and Erik Winton also discussed the FTC’s proposed rule during a recent podcast, as part of the Jackson Lewis podcast series, The Year Ahead. That podcast can be found here:  The Year Ahead in the Proposed FTC Rule Banning Non-Competes.

On January 5, 2023, the Federal Trade Commission (FTC) issued a Notice of Proposed Rulemaking (NPRM) to broadly ban the use of non-compete covenants throughout the country. The proposed rule, which would supersede all contrary state laws, is remarkable for its sweeping definition of “non-compete clauses” that fall within the ban. Jackson Lewis provided an initial alert on the proposed rule and now undertakes a more thorough review of the proposal, including a summary of what the proposed rule contains; employers and persons excluded from coverage under the proposed rule; the potential implications to employee benefit plans; and the next steps in the rulemaking process. That review may be found here: A Deeper Dive Into FTC’s Proposed Non-Compete Rule.