District of Columbia: Bans Non-Competition Agreements

The District of Columbia passed the Ban on Non-Compete Agreements Amendment Act of 2020, which prohibits non-compete agreements entered into by any D.C. employee once the Act became effective, except certain physicians whose annual compensation exceeds $250,000, as well as volunteers, lay members of religious organizations, and casual home-based babysitters. There are specific restrictions to the physician exception that employers should review, including a notice requirement.

Additionally, employers cannot restrict employees from having other jobs or their own business while employed, or restrict their subsequent employment.  However, employers can still protect their own confidential, proprietary, or sensitive information, client or customer lists, or trade secrets.

Employers must provide notice to all employees stating: “No employer operating in the District of Columbia may request or require any employee working in the District of Columbia to agree to a non-compete policy or agreement, in accordance with the Ban on Non-Compete Agreements Amendment of 2020.” This notice must be provided (1) within 90 days after the Act is effective, (2) to new employees within 7 days of hire, and (3) within 14 days following an employee’s request for the notice. There are also anti-retaliation protections, penalties, and enforcement provisions for violation of the Act.

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