Noncompetition agreements — also called noncompete clauses — are common features of employee contracts in Wisconsin. However, just because they are common in employment law does not always mean that they are necessary or right. One state recently made significant steps towards protecting workers from overly restrictive clauses that prevent them from finding meaningful employment in the future.
Not all noncompete agreements are bad. Individuals who work high up in companies and are intimately familiar with trade secrets or products that are still in development probably understand why businesses need to protect this information. But what about lower-wage workers such as food service workers or teenage camp counselors? These workers usually will not have access to the kind of information that companies need to safeguard.
Massachusetts recently introduced new legislation that bans the enforcement of noncompete agreements for students, low-wage workers and minors. This move was sparked by one of that state’s representatives who had listened to hundreds of complaints about abuse of noncompete laws. In particular, she cited the case of a high school student who had worked at a summer camp one year but was prevented from working at a different one the following summer because of a noncompete agreement.
There are many situations in which noncompete agreements are a wholly appropriate and necessary part of employment law, but some Wisconsin businesses have taken the practice too far. Targeting minors and low-wage workers severely limits their future employability and may make it difficult for them to financially support themselves. However, these workers may be able to challenge the validity of their noncompete agreements, which can open the door for new and better job opportunities.