“New Surveys to Examine Prevalence and Impact of Non-Competes, including:
- Largest data collection effort ever undertaken on non-compete agreements. PayScale, a company that provides compensation data and software to employers and employees, has committed to collect new data to support the effort to better measure and understand the use of non-compete agreements. This commitment will include anonymously surveying thousands of firms on non-compete practices and asking millions of employees about their non-compete status.”
Non-competes have become somewhat more controversial in recent years. Twenty-six states already regulate the use of non-compete agreements, and three have outlawed the use of them altogether. Not surprisingly, California is on the outlaw list, along with North Dakota and Oklahoma. For those that regulate non-competes, often the regulation is about what types of jobs may include non-competes.
In recent years it seems that many businesses may be turning away from blanket, unenforceable non-competes for all staff, in favor of more targeted non-competes for some staff. These are exactly the types of questions that we seek to explore and uncover so that we can provide organizations with the information and actionable advice they need to stay ahead of the curve when it comes to non-competes. Who uses them, how often, for which staff, in what industries, and in what organizational sizes?
Ultimately, we know that we’re already in a competitive talent market. Of college educated workers over 25 in the US, the current unemployment rate in September was just 2.5 percent. Non-compete agreements often hinder workforce mobility. In this tight talent market, employees may be less willing to sign agreements that limit their mobility. Ultimately that may make it harder to attract top talent.
PayScale will be working with a team of researchers to examine the resulting non-compete data. The team includes Evan Starr, Assistant Professor at Robert H. Smith School of Business, University of Maryland; Natarajan Balasubramanian, Associate Professor of Management at Whitman School of Management, Syracuse University; and Martin Ganco, Associate Professor in the Management and Human Resources Department, University of Wisconsin-Madison. Starr, Balasubramanian, and Ganco plan to complete an analysis of the data with the support of the Ewing Marion Kauffman Foundation.
We look forward to uncovering the trends and reporting back what we find. In the meantime, we encourage you to share your experience with non-competes in the comments section below.