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Why Outlawing Non-Competes in New York is a Bad Idea

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In a March 31 article that was just published in the New York Law Journal, an attorney took the position that New York should follow the lead of a number of other states, such as California, and refuse to enforce non-competes.

To be sure, there is a growing caucus arguing that non-competes inherently stifle creativity and incentives to put out superior work product, because there may be large numbers of employees that feel trapped in jobs where they won't see their own pockets lined with rewards for their individual innovations. Anti non-compete advocates typically point to the hi-tech sector on the West coast, where non-competes are the exception rather than the norm (for more on that argument, see "Study Suggests Non-Competes Inhibit Employee Creativity & Performance").

Leaving aside the lack of peer-reviewed, scientific method-based studies on the subject, I still think this proposal is a bad idea.

Here's why:

New York's laws, at least on paper, do a fairly good job of striking a balance between favoring employees' free mobility to better-paying jobs and opportunities, and enforcing non-competes in those instances where an employer has a legitimate interest in protecting a client base or proprietary information that it went to great lengths and expense to develop and build

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