New York is the Empire State. We pride ourselves on being a place of ambition and opportunity — where hard work is supposed to lead to advancement. But, for millions of workers across the states, a single clause in their employment contracts threatens that promise: the non-compete.
Nearly half of New York workplaces require their employees to sign clauses that prevent them from taking a new job with a competitor or starting a new business, for months or even years after they leave employment. Workers in jobs ranging from baristas and hairstylists to dog walkers and warehouse staff are subject to these clauses. Employers argue that they need to protect their business interests — investments made in employee training, confidential information and trade secrets, product development, and customer retention.
But employers already have sufficient tools to protect those interests without preventing workers from making a living. Confidentiality and non-solicitation agreements, along with existing trade secret laws, offer far more targeted protections. Most workers subject to non-competes never had access to sensitive or proprietary information in the first place.
In practice, the effects of non-competes on workers are severe, forcing them to choose between staying with their current employer or going without a paycheck during the non-compete period. The clauses are an overreach by employers, a blunt instrument imposed on all workers, whether or not they pose any real competitive risk. The result is that many New Yorkers simply seeking a better job are prevented from pursuing new opportunities. In addition, the choice whether to stay or forego work strips workers of bargaining power, because their employer knows they cannot credibly threaten to quit. As a result, wages are suppressed. This doesn’t just harm individual workers, it harms the entire New York economy.
The effects ripple outward. When workers are unable to move freely, labor markets become less efficient. Businesses struggle to fill roles with the best-qualified candidates, entrepreneurship slows, and innovation suffers. This matters especially for New York, where industries from technology and finance to real estate, hospitality, and the creative economy rely on a mobile workforce. In a state already grappling with high costs of living and competition from faster-growing regions, policies that limit workers’ ability to move freely make it harder to attract and retain talent. Ending non-competes for most workers would send a clear signal that New York is serious about remaining economically competitive.
New York now has the chance to join a growing number of other states in modernizing its approach and protecting workers. A bill passed by the New York State Senate and pending in the Assembly would invalidate non-compete clauses for all but high-earners, who make more than $500,000 per year. The proposed bill is the product of a sensible compromise. Rather than banning non-competes across the board, as did a previous bill that Gov. Kathy Hochul vetoed, the pending bill draws the line at a compensation level that captures executives and highly paid professionals — those who are more likely to have access to sensitive strategic information, and more likely to have leverage to negotiate the terms of a non-compete. For the overwhelming majority of New York workers under $500,000, restricting non-compete agreements reintroduces the freedom to work.
States that have limited or eliminated non-competes offer a clear contrast. California, for example, has long invalidated the clauses, and it is no coincidence that Silicon Valley thrives on rapid job movement and entrepreneurial spin-offs. Innovation flourishes when workers can leverage their experience for another company or even start something new. This is why a growing number of states have either followed California’s lead in banning non-competes, or have taken a compromise approach based on a salary threshold, as does the currently proposed in the pending bill before the New York legislature.
With the legislature weighing the bill this session, the decision will shape how competitive New York’s labor market remains in the years ahead. Protecting legitimate business interests doesn’t require sacrificing New Yorkers’ ability to move freely to better jobs. Targeted protections already exist — and when properly enforced, they strike a better balance between protecting businesses and preserving worker freedom.
Making this bill the law in New York will provide higher wages, increase entrepreneurship, and ensure a more just, dynamic labor market our state deserves. If New York wants to remain the Empire State in more than name, it should ensure that opportunity is something workers can actually pursue.
Meredith Miller is a professor at Albany Law School
