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Bill

A 1829

Prohibits non-compete clauses.

2026-2027 Regular Session Introduced by Verlina Reynolds-Jackson and 1 co-sponsor

Prohibits non-compete and no-poach agreements for almost all workers, with limited senior-executive exceptions, and requires notices, postings, and penalties.

Introduced, Referred to Assembly Labor Committee
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Bill Summary · A 1829

Overview

Assembly Bill 1829 (A-1829), introduced in the 222nd New Jersey Legislature, would prohibit non-compete clauses in employment agreements and ban no-poach agreements. It establishes broad protections for workers, with limited exceptions for specific scenarios and senior executives under narrowly defined conditions. The bill directs notice requirements for existing non-competes, sets standards for retained senior-executive agreements, and provides enforcement mechanisms including civil action and Department of Labor and Workforce Development (DLWD) penalties.

Main purpose and intent

  • Prohibit non-compete clauses across private, public, and nonprofit employers for all workers (paid or unpaid), including contract workers, interns, volunteers, and other forms of service providers.
  • Prohibit no-poach agreements between employers that restrict hiring of workers.
  • Establish a framework to protect workers’ ability to seek new employment and to engage in lawful business activity after leaving an employer.

Key provisions and changes

  • Definitions:
    • “Non-compete clause” includes any agreement (written or oral) that restricts a former worker from seeking or accepting work with others or operating a business after employment ends.
    • “No-poach agreement” bans agreements that restrict hiring or contracting for workers between employers.
    • Defines terms such as “worker,” “senior executive,” “policy-making authority/position,” “pay,” and “fringe benefits.”
  • General prohibition (Section 2):
    • For non-senior-executive workers: employers may not seek, require, accept, enforce, or represent that a non-compete exists, effective date of the act onward.
    • For senior executives: similar prohibition on new non-compete agreements after the act’s effective date; limited enforcement of post-date agreements if they meet specific criteria.
  • Existing non-compete clauses (Section 3):
    • Employers with in-effect non-compete clauses must provide a clear, conspicuous notice within 30 business days after the act’s effective date that the clause will not be enforceable.
    • Notice must identify the employer and be delivered in writing (hand, mail, email, or text) using the model language (with multilingual flexibility).
  • Senior-executive non-competes (Section 4):
    • Pre-existing senior-executive non-competes are void unless they satisfy detailed requirements, including disclosure to the worker within 30 business days, narrowing scope to protect legitimate interests, maximum 12-month duration, reasonable geographic scope tied to where the worker operated, alignment with the worker’s actual duties, no retaliation restrictions, and avoidance of waivers of rights or incompatible choice-of-law provisions.
    • If a non-compete is revised to comply, it must be signed by both employer and worker.
    • Provisions on required notices and conditions apply; penalties if not complied.
  • Exceptions (Section 5):
    • Bona fide sale of a business or ownership interest, or sale of substantially all operating assets, allows non-compete clauses to continue.
    • Accrued causes of action prior to the effective date are exempted.
  • No-poach ban (Section 6):
    • No-poach agreements are declared void and against public policy.
  • Remedies and enforcement (Section 7):
    • Affected workers may sue in a court of competent jurisdiction within two years of a triggering event (signing, discovery, termination, or enforcement action).
    • Courts can void the agreement and grant relief, including injunctions, liquidated damages up to $10,000, lost pay, and attorneys’ fees.
  • Employer posting and penalties (Section 8):
    • Employers must post the act or an approved summary in a prominent place at the workplace.
    • Violations trigger escalating penalties: written warning for first violation, up to $250 for second, up to $1,000 for third and subsequent violations, enforceable via the Penalty Enforcement Law.
  • Effective date (Section 9):
    • The act takes effect immediately upon enactment.

Who would be affected

  • All workers who provide services to an employer (paid, unpaid, interns, volunteers, contractors, etc.) would be protected from non-compete restraints.
  • Senior executives face stricter, narrowly defined conditions if any pre-existing non-compete remains enforceable.
  • Employers across private, public, and nonprofit sectors, including franchises, would need to revise or terminate non-compete and no-poach practices.
  • DLWD would oversee notices and penalties for non-compliance.

Procedural and timeline aspects

  • Effective date: immediate upon enactment.
  • For in-effect non-competes at enactment, employers must deliver notices within 30 business days.
  • Senior-executive non-compete disclosures and revisions must occur within specified post-enactment timelines (e.g., within 30 business days for disclosures).
  • Civil actions must be filed within two years of a triggering event.
  • Penalties administered by DLWD under the existing Penalty Enforcement Law.

Potential impact

  • Significantly limits or eliminates the use of non-compete clauses, reducing restrictions on worker mobility.
  • Dampens excepted scenarios for senior executives and bona fide business sales, but tightens safeguards to protect legitimate interests.
  • Reduces no-poach agreements, promoting competition for workers and hiring practices.
  • Creates new compliance obligations for employers (notices, postings, potential penalties) and empowers workers with remedies.

Compiled from official sources — confirm details with the bill’s official record.

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