Washington Lawmakers Seek To Limit Non-Compete Agreements

Mar 14, 2017

Washington state lawmakers are trying to limit the scope of non-compete agreements.

A non-compete agreement is part of a contract that says an employee can't work for a competitor for a certain period of time after leaving a company.

There have been several attempts to restrict the use of non-compete agreements in Washington. Some states, like California, have all but banned them.

Companies use non-compete clauses to make sure former employees don't take trade secrets or their customers to a competing company when they switch jobs. Non-competes will often include geographic restrictions.

However, there are other types of agreements that can protect that information without keeping people from work, according to Seattle employment lawyer Alex Higgins.

"We can have confidentiality agreements and non-solicitation agreements that adequately protect employers," he said.

The problem with non-compete agreements is the balance of power skews toward the employer, Higgins said.

Many people don't know they need to sign one until after they have already accepted an offer of employment. They can also be difficult and expensive to fight once they've been signed.

This latest bill would void non-compete agreements for independent contractors and people who get laid off. It also provides broader protections for employees looking to challenge a non-compete agreement and requires employers to present the agreement earlier in the hiring process.

It passed the state House 97-0 last week. It now makes its way to the state Senate.