NYC employers – But Wait…There’s More! The NYC Council has now introduced two more bills that would restrain the use of non-competes.

As previously reported on PERKS, New York City. Bill No. 140 would ban all current and future non-compete agreements in New York City (with limited exceptions). In contrast, among other differences, Bills No. 146 and 375 would:

  1. only apply to non-compete agreements entered into after the effective date of the law, not to existing agreements, and
  2. target only specific categories of NYC workers.

Bill No. 146 proposes a ban on non-competition agreements for “low-wage workers”, who are defined under the bill as “clerical or other workers” under section 190 (7) of the New York labor law. Bill 146 would also require employers to notify non-low-wage workers at inception of the hiring process, in writing, that they might be asked to enter into a noncompete agreement if they commence employment. Full text of the proposed bill can be found here: The New York City Council – File #: Int 0146-2024

Bill No. 375 proposes a ban on non-competition agreements for “freelance workers” unless the hiring party contractually agrees to pay the freelance worker an agreed-upon amount of money for the duration of the non-compete period. A “Freelance worker” is defined under the bill as “any natural person or any organization composed of no more than one natural person, whether or not incorporated or employing a trade name, which is hired or retained as an independent contractor by a hiring party to provide services in exchange for compensation”; however, the bill specifically excludes certain professionals including lawyers, medical professionals, and sales representatives. Bill No. 375 further distinguishes itself from Bill No. 140 and Bill No. 146 because it provides workers with a private right to sue for violations of the law, potentially entitling workers to $1,000 in statutory damages, reasonable attorney fees and a declaration that the non-compete is unenforceable. Full text of the proposed bill can be found here: The New York City Council – File #: Int 0375-2024

We will continue to monitor all three proposed laws and related actions by the NYC Council. Stay tuned!