EIG Applauds Reintroduction of Bipartisan Bill to Reform Non-Compete AgreementsFeb 25, 2021
Washington, D.C. – The Economic Innovation Group (EIG) commends Senators Todd Young (R-IN), Chris Murphy (D-CT), Kevin Cramer (R-ND), and Tim Kaine (D-VA), and Representatives Scott Peters (D-CA-52), Mike Gallagher (R-WI-8), Anna Eshoo (D-CA-18), and Peter Meijer (R-MI-03) for reintroducing the Workforce Mobility Act. This bipartisan legislation would limit the use of non-compete agreements by employers and aim to end the widespread abuse of these harmful agreements nationally.
“Non-compete agreements hinder worker mobility, reduce wage growth, and stifle entrepreneurship and innovation,” said John Lettieri, President and CEO of the Economic Innovation Group. “At a time when millions of workers have been displaced by a pandemic and economic crisis, the bipartisan Workforce Mobility Act would be a major step in fostering a more open and dynamic economy in which all Americans can achieve their full potential. EIG applauds Senators Murphy, Young, Cramer, and Kaine, and Representatives Peters, Gallagher, Eshoo, and Meijer for their leadership on this important legislation.”
A new piece released by EIG today illuminates the harmful economic impact of non-compete agreements, which cover 20 percent of all workers or approximately 30 million Americans. The prevalence of non-competes ranges from nine percent in the agricultural industry to 26 percent among healthcare support workers and upwards of 30 percent in the professional, scientific, and technical industry. The analysis highlights research that finds a disproportionately harmful effect of stricter non-compete enforceability on historically marginalized workers, lowering earnings for female and nonwhite workers by twice as much as for white male workers. A past EIG report by University of Maryland Professor Evan Starr explores in-depth the proliferation of non-compete and no-poach agreements and their damaging effects on the U.S. labor market and American workers.
The bipartisan Workforce Mobility Act was originally introduced by Senators Young and Murphy in the Senate in 2019 and Representatives Peters, Gallagher, and Eshoo in the House in 2020 to limit the legal use of non-compete agreements, require employers to notify employees of the limits of their application, and delegate appropriate enforcement and reporting responsibilities to the Federal Trade Commission and the U.S. Department of Labor.
EIG Media Contact: [email protected]
About the Economic Innovation Group (EIG)
The Economic Innovation Group (EIG) is a bipartisan ideas laboratory and advocacy organization whose mission is to advance solutions that empower entrepreneurs and investors to forge a more dynamic American economy. Headquartered in Washington, D.C., EIG convenes leading experts from the public and private sectors, produces original research, and works to advance creative legislative proposals that will bring new jobs, investment, and economic growth to communities across the nation. For more information, visit eig.org.