In recent years, several states have enacted statutes banning or significantly limiting an employer’s ability to require an employee to enter into a covenant not to compete. On Feb. 10, 2025, Sen. Sean Ryan introduced a bill (S4641) that, if enacted, would put New York in that category. On June 9, 2025, the bill passed the Senate and was delivered to the Assembly. The bill would ban covenants not to compete other than those pertaining to highly compensated individuals and would require that an employer continue paying the former employee’s salary during any period of enforcement. In 2023, Ryan introduced a bill that would have banned covenants not to compete in New York entirely, but Gov. Kathy Hochul vetoed the bill in December 2023. Now, he is taking a second swing.
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