The highly publicized 2023 legislation in New York and the simultaneous proposed and then final FTC rule, which would have banned most noncompetes, consumed the attention of commentators and employers for much of the last 18 months. It is likely that the focus on prospective sweeping bans, that many believe never had a chance of going into effect, may have served as a distraction, obscuring what is actually happening with the enforcement of non-competes in New York and elsewhere across the nation.

This article will examine the current state of noncompete law, focusing on recent administrative, legislative and judicial developments. While no landmark cases have significantly altered the legal standard in New York established by the seminal 1999 BDO Seidman v. Hirshberg decision, recent decisions suggest an increasing trend of enhanced hostility toward and scrutiny of noncompete agreements and less tolerance for overbroad language and scope. There also appears to be an emerging legislative, regulatory, and public appetite for some restrictions—particularly for lower-wage and non-unique employees. So, given this reality, what should employers be doing now to protect their trade secrets, confidential information, and goodwill in the face of anti-noncompete headwinds?

The State of the Law and Current Trends