Tens of millions of American workers across a range of occupations are bound by restrictive employment agreements. The COVID-19 pandemic has caused people to leave their jobs in search of more money, flexibility, and happiness—deemed the Great Resignation—shining a new light on the volatility of labor markets. But restrictive employment agreements limit workers’ exit options and stymie competition, in tension with our nation’s antitrust laws. The effects of these agreements are particularly damaging to low-wage workers. Rightfully so, policymakers across jurisdictions and political ideologies are increasingly introducing measures to curtail the abuse of these agreements. This area of the law would benefit from timely, uniform, and comprehensive reform. The Uniform Restrictive Employment Agreement Act (“UREAA”) has emerged as a forward-thinking piece of legislation that seeks to unify the current patchwork of state laws targeting various renditions of restrictive employment agreements. Every state should adopt UREAA, and the federal government should join their surging fight against restrictive employment agreements.
This Note expresses the state of the law as it exists on August 1, 2022. Part I ushers in the concept of labor mobility and its particular importance to low-wage workers. Part II explains how current events are influencing workers’ changing attitudes towards their jobs, spotlighting the need for labor mobility. Part III introduces a widespread barrier to labor mobility—restrictive employment agreements, which function as restraints of trade. Part IV presents the role of antitrust as a safeguard against unreasonable restraints of trade. Part V synthesizes common arguments for and against restrictive employment agreements as unreasonable restraints of trade, exploring the changing landscape of restrictive employment agreement laws, as jurisdictions re-examine their usefulness and fairness. Part VI presents this author’s view that action against restrictive employment agreements should be timely, uniform, and comprehensive. Part VII encourages states to adopt UREAA in consideration of these metrics, while also acknowledging the Act’s limitations and highlighting areas in which the federal government can contribute. Part VIII concludes by providing a model for multilevel enforcement of restrictive employment agreement laws.
