DC Ban on Non-Competes Postponed to April 1, 2022

Proskauer - Law and the Workplace
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Proskauer - Law and the Workplace

As we previously reported, earlier this year the District of Columbia enacted the The Ban on Non-Compete Agreements Amendment Act (the “Act”), which creates the broadest non-compete ban in the country.  The Act essentially bars post-employment non-competition agreements as well as prohibitions on simultaneous work for other employers.  Although the Act became law in March, its restrictions are tied to its “applicability date,” which is defined as “the date of inclusion of its fiscal effect in an approved budget and financial plan.”  In addition to scrambling to figure out how to comply with the new law, the Act’s “applicability date” left employers uncertain about when the Act would take effect.  That uncertainty has now been lifted.

On August 23, 2021, Mayor Bowser signed the Fiscal Year 2022 Budget Support Emergency Act of 2021, which among many other things amends the Act’s applicability date provision to state:  “This act shall apply as of April 1, 2022.”

This development gives employers certainty about when the law will go into effect.  The delayed applicability date of the Act also gives employers some hope the Act will be amended before April 1, 2022.  As previously reported, amendments to the Act have been proposed, though there have been no developments on that front since a July 14, 2021 hearing.

We will continue to report on developments on the Act.

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DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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