NLRB Interpretation would Restrict Non-Compete Provisions

On May 30^th, General Counsel Jennifer Abruzzo of the NLRB sent out a memo informing all regional directors, officers-in-charge, and resident officers that the proffer, maintenance, and enforcement non-compete provisions in employment contracts and severance agreements violate section 7 of the National Labor Relations Act except in limited circumstances.  A Non-compete provision is an agreement or clause in an employee’s contract, prohibiting them from entering into competition with their current employer after their employment period is over.  In the view of the General Counsel, this type of provision violates employee’s rights, as it among other things is a “denial of access to employment”.  However, it was stated that in some situations noncompete agreements could be lawful, if the agreement “clearly restricts only individuals managerial or ownership interests”.