On January 11, Mayor Muriel Bowser signed “The Ban on Non-Compete Agreements Amendment Act of 2020” (the “Act”). Though some other states and municipalities have restricted the use of non-compete agreements, the District of Columbia’s new ban – once it is applicable – will go further than similar laws in any other jurisdiction. With few exceptions, employers in the District of Columbia will not be allowed to include non-compete provisions in employment agreements or maintain workplace policies that prohibit employees from simultaneously working for a competitor of the employer. Employers with operations in the District of Columbia also must be aware of the notice and non-retaliation requirements, as well as the penalties for non-compliance.
The breadth of the ban is breathtaking – it covers any non-compete provision or policy that prohibits an employee from being “simultaneously or subsequently employed by another person, performing working or providing services for pay for another person, or operating the employee’s own business.” The Act does not prohibit employers from utilizing confidentiality agreements or policies that prohibit an employee from disclosing the employer’s “confidential, proprietary, or sensitive information, client list, customer list, or a trade secret.” The Act also does not invalidate non-compete agreements executed before the effective date of the Act. The Act is silent as to non-solicitation agreements, suggesting employers can continue to require and enforce those agreements.
For more information on the Act, please check out our more detailed coverage here.