New York Governor Hochul vetoes noncompete bill

After a furious lobbying campaign by New York employers and business groups, Governor Kathy Hochul vetoed a bill in late December 2023 that would have banned virtually all employee noncompete agreements in New York State.

The proposed legislation would not only have amended the New York Labor Law to prohibit noncompete agreements, but its broad language could have been interpreted to proscribe nondisclosure and nonsolicitation agreements as well. Further, the bill contained no exceptions for situations concerning the sale of a business.

No compromise, so no law

In negotiations with the New York State legislature, Governor Hochul suggested amending the bill to exempt employees earning at least $250,000 per year.

But the bill’s sponsors in the legislature weren’t willing to accept such a compromise, leading the governor to veto the bill. In the veto memo, however, she said she continues to support legislation that, with respect to noncompete agreements, would protect “middle class and low-wage earners.”