North Carolina businesses and employees should keep an eye on House Bill 269—the “Workforce Freedom and Protection Act”—which, if passed, will significantly change the landscape for noncompete and non-poaching agreements. Traditionally, employers have used noncompete clauses to limit a former employee’s ability to work for a competitor within a certain time frame, geographic area, or specific type of work. While these agreements have been a staple in protecting company interests, critics argue they unfairly limit workers’ career mobility and bargaining power.
House Bill 269 aims to strike a new balance. It would prohibit noncompete agreements that restrict an employee’s right to work elsewhere based on time, location, or activities—but only for employees earning less than $75,000 per year. Notably, it does not apply to non-compete agreements entered prior to the effective date. The idea is to protect lower- and middle-income workers who are often most vulnerable to restrictive contracts that can lock them into low-paying roles or prevent them from finding better opportunities. For higher-income earners above this threshold, noncompete agreements would still be allowed, provided they meet existing enforceability standards under North Carolina law.
Employers will need to review their employment agreements carefully if this bill becomes law. Beyond simply revising or removing noncompete language for affected employees, businesses may need to rethink their strategies for protecting their business interests.
At Lord & Lindley, we help businesses and employees navigate the ever-changing legal landscape of employment agreements. Whether you’re reviewing existing contracts, drafting new ones, or need guidance on compliance with evolving laws like the Workforce Freedom and Protection Act, our team is ready to assist. To learn more or schedule a consultation, call us at (704) 457-1010 or visit www.lordlindley.com.