{"id":6833,"date":"2023-06-08T13:52:53","date_gmt":"2023-06-08T17:52:53","guid":{"rendered":"https:\/\/employerdefensereport.com\/?p=6833"},"modified":"2026-03-20T11:54:03","modified_gmt":"2026-03-20T15:54:03","slug":"nlrb-throws-its-hat-into-the-non-compete-provision-conversation","status":"publish","type":"post","link":"https:\/\/www.connmaciel.com\/employer-defense-report\/nlrb-throws-its-hat-into-the-non-compete-provision-conversation\/","title":{"rendered":"NLRB Throws Its Hat Into the Non-Compete Provision Conversation"},"content":{"rendered":"

By Samuel S. Rose<\/a><\/p>\n

On May 30, 2023, Jennifer Abruzzo, General Counsel at the National Labor Relations Board (NLRB), issued Memorandum GC 23-08<\/a> regarding Non-Compete Agreements. While the guidance memo is not law, it provides employers with context for the NLRB\u2019s enforcement position and future policy decisions. \"Screenshot<\/a>This is the latest development on the issue of non-competes, with the FTC already considering a rule<\/a> that would essentially prevent employers from entering into non-compete agreements with employees.<\/p>\n

What Does the Memo Say?<\/strong><\/p>\n

The memo focuses on Section 7 rights, which protect employees\u2019 \u201cright to self-organization, to form, join, or assist labor organizations, to bargain collectively through representatives of their own choosing, and to engage in other concerted activities for the purpose of collective bargaining or other mutual aid or protection.\u201d It notes that it is an unfair labor practice in violation of Section 8(a)(1) for an employer to interfere with or restrain employees from exercising their Section 7 rights.<\/p>\n

Abruzzo writes that non-compete provisions are overboard in that \u201cthey reasonably tend to chill employees in the exercise of Section 7 rights, when the provisions could reasonably be construed by employees to deny them the ability to quit or change jobs by cutting off their access to other employment opportunities that they are qualified for based on their experience, aptitudes, and preferences as to type and location of work.\u201d The memo goes on to identify five types of protected activity that are chilled by non-compete provisions:<\/p>\n

    \n
  1. \n
      \n
    1. Concerted threats to resign to demand better working conditions.<\/li>\n
    2. Carrying out concerted threats to resign to demand better working conditions.<\/li>\n
    3. Concerted efforts to seek or accept employment with a local competitor for better working conditions.<\/li>\n
    4. Soliciting co-workers to work for a local competitor.<\/li>\n
    5. Seeking employment to specifically engage in protected activity with other workers at an employer\u2019s workplace.<\/li>\n<\/ol>\n<\/li>\n<\/ol>\n

      In Abruzzo\u2019s view, a non-compete provision that chills these activities violates the NLRA unless it is \u201cnarrowly tailored to special circumstances.\u201d She goes on to point out that \u201ca desire to avoid competition from a former employee is not a legitimate business interest that could support a special circumstance defense.\u201d Specifically, Abruzzo notes that it is unlikely that a non-compete provision would be reasonable when imposed on \u201clow-wage or middle-wage workers who lack access to trade secrets\u2026or in states where non-compete provisions are unenforceable.\u201d<\/p>\n

      What Should Employers Be Doing?<\/strong><\/p>\n

      In jurisdictions where non-compete provisions have been deemed unenforceable, this memo does little to change the analysis. However, in jurisdictions where non-compete provisions have not been deemed unenforceable, employers should review the language in their provisions to ensure that they are not drafted in a way that could be interpreted to violate employee rights under the NLRA. All employers should continue to monitor developments in the FTC rulemaking process, which is expected to continue into 2024.<\/p>\n","protected":false},"excerpt":{"rendered":"

      By Samuel S. Rose On May 30, 2023, Jennifer Abruzzo, General Counsel at the National Labor Relations Board (NLRB), issued Memorandum GC 23-08 regarding Non-Compete Agreements. While the guidance memo is not law, it provides employers with…<\/p>\n","protected":false},"author":3,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[15],"tags":[910,826,850],"class_list":["post-6833","post","type-post","status-publish","format-standard","hentry","category-traditional-labor-relations","tag-labor-union-activity","tag-policy-handbooks","tag-trade-secrets-non-competes"],"acf":[],"yoast_head":"\nNLRB Throws Its Hat Into the Non-Compete Provision Conversation - Employer Defense Report<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/www.connmaciel.com\/employer-defense-report\/nlrb-throws-its-hat-into-the-non-compete-provision-conversation\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"NLRB Throws Its Hat Into the Non-Compete Provision Conversation - Employer Defense Report\" \/>\n<meta property=\"og:description\" content=\"By Samuel S. 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